Stock Picks from the Market Crash

1

In this thread, we could post observations or inquiries about stocks/companies that do not yet have their own thread/active discussion on the forum. The purpose is to collect “discoveries” from different exchanges now that, due to the stock market crash, especially small-cap companies’ valuation levels have significantly decreased. This is so that they don’t get lost in the coffee room in a day.

Did you find a previously unknown company that seems promising, but the stock price seems low compared to its track record and forecasts? Briefly introduce the company and ask other forum members if they have followed the company or if anyone knows more about it!

27 Likes
2

I can start with this.

This is a technology company that apparently operates in the infrastructure sector and acquires various companies. Q2 growth was 27% and profitability seems quite good, although Q2 results grew significantly more than revenue, and there is apparently some one-off item included.

Apparently, Redeye also analyzes them, and the previous earnings report slightly exceeded forecasts.

5 Likes
3

Activision Blizzard is interesting in this market. Inflation doesn’t seem to weigh too heavily on gamers’ wallets; in the worst-case scenario (unemployment), player numbers would likely increase. Especially since Blizzard has such no-life games :rofl:

I have high expectations for Microsoft’s acquisition, or rather, I believe it will happen with 95% certainty. It has fallen less than the market, but still fallen!

4 Likes
4

In my portfolio, reasonably sized companies could be:
The following to check out:

Perion Network: Trailing 12-month P/E ratio around 13, with two weak quarters about to drop off, and guidance raised multiple times. Net cash of over 300 million, with a valuation just under 900 million. So, a good third of net cash. Performed relatively well.
Plenty of information on the forum.

Inmode: P/E ratio around 15, price around 28. Net cash is also substantial, if I recall correctly, about 5-6 EUR/share? I expect modest earnings growth.

Kaspi.kz: Kazakhstan’s gem… Has risen about 50% since spring, but P/E is about 9-10, and they are buying back their own shares and paying dividends. Kazakhstan seems to have shifted allegiance to China from Russia… Good or bad? Dominates digital commerce and payment traffic, etc., sovereignly, but there should be room for growth. Geopolitical risk affects pricing…

I’ve added all of these, and it’s been okay.

Siltronic: Manufactures silicon wafers for the semiconductor industry. The share price is below 60, and a dividend of 3 EUR, or 5%, should be coming. Earnings should be strong due to the peak cycle, but part of the cash flow goes to the new production facility in Singapore (completion in 2024).
I am now buying “cheap” for the third time, and so far, I’ve managed to sell at around 140-150 EUR/share while waiting.
While waiting, the goal is to get cash flow from dividends.

Purchases for Siltronic are ongoing, with the next levels being 52 and then more significantly at 50 EUR. I believe they raised their outlook in Q2, so let’s see if the quarterly report is good. A recession is clearly being priced in.

11 Likes
5

Here are my favorite picks from Sweden, where operations are on a solid foundation. More ideas are available, but let’s start with these.

Tobii Dynavox
Does incredibly important work. The company aims to give a voice and a way to communicate to individuals who are unable to do so due to illness or congenital limitations – “Do what you once did or never thought possible.”
The company develops and manufactures communication aids, primarily based on eye-tracking technology. Tobii Dynavox was spun off as its own company from Tobii, which develops eye-tracking technology mainly for VR applications.
Good growth, strong margins, generates good and sustainable cash flow, and the target market is incredibly large.

Biogaia
The world’s leading manufacturer of lactic acid preparations and probiotics with over 30 years of experience in their research and development. The company’s products are on the market in over 100 countries. BioGaia’s patented lactic acid bacterial strains have been the subject of over 200 clinical, published studies. Research and product development for new microbial strains for various indications continue actively. Biogaia issued a positive profit warning in July due to strong European demand, and the company is returning to a growth trajectory. The current EV/EBIT is in line with its 3-year history, even though the company has developed and taken steps forward during this time. Double-digit organic growth is also expected for the rest of the year, and margins are very strong. A strong performer and a DEBT-FREE COMPANY. It has come down about -40% from its April peaks.

AFRY
Formed when Swedish ÅF and Finnish Pöyry merged. An engineering/design/consulting company. YTD approx. -50%, now at pandemic lows, and before that, at these prices in 2016. Insiders have been buying, and analysts like it. The valuation already prices in a lot of bad news, even though demand has slowed down a bit in some sectors.

Arjo
Develops, manufactures, and sells assistive devices for mobility and daily tasks, primarily for the elderly and those with limited mobility. The company has a long history but was only listed in 2017. Gross margin is around 45%, EBITDA margin is 21%, and it generates free cash flow. The biggest challenge has been the availability of components and materials. The company apparently did not benefit exceptionally from the pandemic; on the contrary. Now it is below pandemic lows. Insiders have been buying this year, about 2 million shares went into a fund as a new purchase in August, it’s an SHB small-cap pick, and analysts like it, in addition to myself. A downside is its debt.

Fasadgruppen
YTD approximately -50%. A serial acquirer listed in Sweden, primarily focusing on various facade, window, and roofing works.
This year, insiders have been on the buying side, and it’s cheaply priced. The company continues its growth strategy and will also start making acquisitions in Finland. In this environment, debt is a slight negative.

Vimian
Manufactures and develops veterinary technology, implants, diagnostics, pharmaceuticals, etc. The company was listed in 2021, and the performance has been ugly, YTD almost -70%, and almost -80% from 2021 peaks. The CEO has presented confidently and with optimism, but I am still waiting for insider purchases. Regular acquisitions. Good margins, positive cash flow, and strong growth. A downside is its debt.

28 Likes