Assisted Living / Dying
There is a degree irony in the timing of the government’s assisted dying legislation this week. Firstly, that amongst all its ever grow issues, immigration, taxation, economic growth, cost of living crisis, nuclear war, it has the time to spare on an issue that should never have been a thing in the first place. We have doctors. And the nightmare of giving lawyers / judges the final say in our lives is already a nightmare, as High Court cases relating to Great Ormond Street Hospital periodically show. While those who wish to end it all deserve all the help and kindness we can give, it is want to live and thrive that should always be the priority.
M&A Bonanza
This week delivered a glass half empty / half full message as far as the stock market is concerned. On the good side there was a decent smattering of M&A – the purpose of the stock market, affecting the likes of Direct Line (DLG), Loungers (LGRS) and TT Fluid Systems (TIFS). There were also companies raising the white flag such as Scholium (SCHO) and Webis (WEB) who are to de-list. Here rather than being kicked off the market by a bid, the companies clearly decided it was just not worth going on with the lack of liquidity, cost, and low valuation. Painful in the extreme was news from Electric Guitar (ELEG), a relatively recent stock market arrival. The digital marketing and advertising company providing first-party data solutions, announced that the Board of 3radical Limited, Electric Guitar’s principal trading subsidiary, has called in the administrators.
In fact, for my money, the real shocker has been the departure of Just Eat (JET), where even the obvious marketing advantage of being a significant listed company on the LSE was not even for it to be bothered to stay.
As I have said many times before (and not expecting any results), the cost, the bureaucracy and the barriers to investing (CGT, stamp duty, AML, IHT) have all killed the London stock market. The powers that be pretend all is fine and dandy (it probably is for them). The only answer that could possibly turn things around for listed companies would be either a package deal to be listed which includes all the necessary service providers, or a subscription model, including all the lawyers, accountants, auditor, exchange fees. But of course, this would / could never happen.
This Week’s Risers
It has not exactly been a fabulous history on the stock market for StreaksAI (STK), the AI languages play, down 77% last year, and even after this week’s 171% rise, down 36% in 2024, we seem to have a decent turning point. The trigger has been a new 16% stakeholder, something which looks serious. Indeed, serious enough to remind us that at the end of the day for the stock market to work people have to buy shares and do it significantly. Who’d have thought it?
Just for a change, shares of project developer Oracle Power (ORCP) went up and largely stayed up, off the back of revealing high grade gold at its Northern Zone project. This was perhaps surprising, given that the project has always looked prospective. The question now is whether already having raised £150,000 last month, the company will allow the shares to rebound more, and give its shareholders a breather?
Of course, the Week In Small Caps likes to particularly focus on stocks that have risen significantly on new fresh news. A rather unlikely member of this club have been Premier African (PREM), MicroSalt (SALT), Kefi (KEFI) and RBG Holdings (RBGP). As far as PREM is concerned, the last we heard from the company was that it had appointed VSA Capital as corporate adviser, as it has “successfully concluding natural resource deals with Chinese based companies.” At the end of October shares of SALT soared after it revealed new bulk purchase orders. Perhaps the shares are looking forward to a new batch of orders. For KEFI it would appear that the combined news of a strategic review of its Saudi JV, as well as Tulu Kapi project financing has finally kicked in positively. In the case of RBGP we saw share buying by a significant person, at 1.75p back in October. The shares closed this week at 2.8p.
Optibiotix
A little while ago it was hinted to me in the coffee houses of the City of London that Optibiotix (OPTI) may become somewhat cash strapped due to under performance in its businesses. Of course, selling shares in its portfolio could be a way of stemming the losses, although as we know if the shares are in a spin off company this is not a great look. However, desperate times can call for desperate measures. That said, in October the TR1 from SkinBioTherapeutix (SBTX) was only marginal, and perhaps if there is more selling it would be of a similar nature. We have SBTX’s results to look forward to on Wednesday.
Andrada Mining
One of the companies in the small cap area which has continued to be under valued by the stock market is Andrada Mining (ATM), a critical raw materials producer with mining and exploration assets in Namibia. It announced its unaudited interim financial results for the six-months ended 31 August 2024 on Thursday. Therefore, it was pleasing to see the shares finally rebound off their lows. The company said “the value-accretive restructuring of UTMC simplified Andrada’s ownership and operational structure in the underlying licences while empowering its local partners through equity ownership participation at Group level. The restructuring has also created opportunities for more rapid asset development through project-specific financing solutions.” This is certainly a start, and goes some way to demystifying a company whose potential share buyers would no doubt have been put off by the perceived complexity of the businesses it contains.
Global Petroleum
After seemingly being a bridesmaid rather than a bride in terms of the stock market’s coterie of most followed plays, Global Petroleum (GBP) updated on the progression of the Namibia oil and gas PEL94 project and Juno Project. The result was the shares rising 61% on the week, and one would guess one or two people taking profits too early.
EnergyPathways
Finally, this week I attended an event hosted by AI firm Pri0r1ty AI in the City, and EnergyPathways (EPP). I have to say that I rarely go to events these days, as I tend to get mobbed by fans! However, I was interested in seeing who, and how many people would turn up for a company, EPP, which has been one of the biggest small cap winners of the year. In fact, there were a lot of people there that I knew, and some of them were even brave enough to say hello. What will be interesting to see going forward is how after the shares have climbed nearly 200% this year, what further progress can be made. EPP rocketed in October on new of government collaboration and in hydrogen storage, as well as a £5m loan facility for the MESH project. As is typical of the London stock market, there is even more kicking of the tyres when a stock goes up, than when it is down: so aspects concerning the 2 year old lender, the timeframe, and timelines involved with MESH. Of course, a big part of the reason that EPP shares have soared as they have was a result of catching the market out regarding its funding position. Our friends at Global Green Asset Finance arriving with their bolt from the blue loan, will have caught many traders on the hop.
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