Without the one-offs (including IPO expenses for AIM listing), this year should be a strong year for Global Invacom.
The company is deserving of premium valuation as it is the only industry manufacturer of electronics and antennas for satellite reception. It is the only supplier with a global footprint, and it has relationships with multiple major Broadcasters around the world.
The acquisition of Skyware is particularly interesting because the vendor is a private equity firm (EDGEWATER) which will be paid (partly) in shares that will give it a 9.9% stake in Global Invacom. This is a strong endorsement by EDGEWATER of Global Invacom's fundamentals. (33 cents share price currently.)
Share price is a lot cheaper now @ 22 cents compared to the 33 cents in the post above. I am beginning to appreciate this business -> high barriers to entry as it's a niche business and requires lots of tech know-how and the customers are big players with their own business barriers to entry.
It's still going up; 19 cents right now! There are 3 problems that stop people from buying into this business, which on closer examination are no problems at all. Firstly, it is quite technical and people don't understand how it makes money; actually SATCOM is a very stable business for large countries that cannot afford to lay fibre optic cables to places far from city areas. Secondly, the usual cost of its most recent acquisitions have been put into P&L which depresses its net earnings; but once over, profits will go back to normal. Thirdly, some of its customers delayed (not cancelled) their normal purchases of equipment this last quarter. Because of the huge drop in prices, GIGL has scooped up large amounts of share buy-backs as ammo for its future acquisitions, which comes in handy when its share price goes up again.
