Tuesday, 8 December 2015



What does it do? 

Bacially ITQ is a recruitment agency specialising in the digital field. That might be doing them a bit of a disservice as they arent just the run of the mill agency.
They try to concertrate more on more highly skilled post and match blue chip companies with the type of IT expert it would be difficult if not impossible to find elsewhere

From their website...
We focus on jobs within information security, analytics, digital, telecom and technology. Operating in high growth areas of the new digital economy, we recruit across all industry sectors with a particular focus on financial markets, retail, not for profit, public sector and professional services.

Historic Price Action

Back in sept/oct '14 ITQ put themselves up for sale and the price rose to 120p+. This was subsequently aborted with the management citing poor advice from NOMAD. The SP fell away despite continuing strong financial proformances with the occasional spike. See video below for management explaination.

ITQ in the Media

Be it a plus or minus, ITQ is championed by Tom Winnifrith and Shareprophets.
One or two articles! The SP has fell from 100p ish to 80-85p now but i think he's been right all along and a re-rate will happen.

Midas say buy

Directorate Changes

Seemingly after the botched sale, both the CEO and CFO decided to move on. They both sold a decent whack of shares in the open market. The chairman stepped back up to be more executive and able replacements have now been found. It is worth noting that during this turmoil the company has continued to perform superbly with increasing profits, revenues and EPS.

" InterQuest Group plc (AIM: ITQ.L), the specialist recruiter in technology, analytics and digital markets, is pleased to announce that following a comprehensive search, it has reached agreement with Chris Eldridge to become CEO of InterQuest. For the past 10 years, Chris has been the Global Head of PSD's Technology Practice specialising in recruitment in specialist digital, business information, Internet of Things, M2M, big data and analytics roles. Chris has over 20 years' experience in the recruitment sector having run both permanent and contract focused businesses as well as conducting business in continental Europe, the USA and China. Chris is expected to assume his position on 2 May 2016 after an orderly handover period at his current employer."

"InterQuest Group plc (AIM: ITQ.L), the specialist recruiter in technology, analytics and digital markets, is pleased to announce that further to the appointment of Chris Eldridge as CEO announced on 5 November 2015 it has also reached agreement with David Bygrave to become CFO of InterQuest. David has extensive experience of CFO roles within the technology sector having most recently been the CFO of Caplin Group from 2010 until the sale of the company earlier this year. David will assume his position on 1 December 2015."


On the 1 year chart is there a triple bottom at around 80? Its in a falling wedge with lower highs and as El1te pointed out to me, the market is less and less willing to buy this. He thinks this is bearish and hes smarter than me. If 80 breaks where will it go to?


Year End 31st Dec 2009 2010 2011 2012 2013 2014 TTM 2015E 2016E CAGR / Avg
Revenue £m 97.4 112.2 120.9 112.7 114.9 150.6 158.8 158 166 +9.1%
Operating Profit £m 1.91 2.41 0.066 -0.14 1.68 3.31 3.70

Net Profit £m 1.35 1.90 -1.07 -0.15 0.98 2.00 2.54 4.00 4.00 +8.2%
EPS Reported p 4.19 5.86 -3.39 -0.43 2.79 5.48 6.96

EPS Normalised p 4.19 5.86 2.56 4.00 4.17 6.81 7.42 10.9 12.0 +10.2%
EPS Growth % -50.5 +39.7 -56.3 +56.3 +4.3 +63.4 +101.8 +60.0 +10.1
PE Ratio x

12.1 11.1 7.57 6.88

0.21 0.19 0.75 1.03

So from the 2014 results, the increase in net profit is expected to be 57% to £4mill
The normalised EPS is expected to increase to 10.9p, a 60% increase.

Interims 2015
So are they on course for that 4mill profit and 10.9p EPS??
Adjusted EBITA* on a constant currency basis up 17% to £2.8m (2014: £2.4m)
§ Adjusted EBITA* up 13% to £2.7m (2014: £2.4m)
§ Adjusted PBT* up 14% to £2.5m (2014: £2.2m)
§ Profit for the period increased by 33% to £1.6m (2014: £1.2m)
§ Net Fee Income ("NFI") up 6% to £12.1m (2014: £11.4m)
§ Improved EBITA / NFI ratio of 22.2% up 110-bps from 21.1% in 2014
§ Revenue up 11% to £81.2m (2014: £73.0m)
§ Diluted adjusted earnings per share up 20% to 5.5 pence (2014: 4.6 pence)
§ Basic earnings per share up 47% to 4.7 pence (2014: 3.2 pence)
§ Basic adjusted earnings per share up 16% to 5.7 pence (2014: 4.9 pence)
§ Net cash generated from operating activities £2.8m (2014: £3.4m)

One year rolling PE is 6.84 vs sector median of 13.6

Using stockopedia implied valuations...
Discounted cash flow = 123.87p
Graham formula = 201.32p
Relative to sector  = 116.88p


I had thought this would be a good buy at 80p but Mr El1teTrader convinced me to watch a little longer. If 80p breaks where will it go to? I still think at 80p its undervalued but id like to buy when its at its most undervalued!!

Clearly dont just buy based on my recommendation or anyone elses. Do your own reseach. Pick an entry you are happy with, pick a target exit you think is achiveable. This share may go up and down quite a bit before the target catalyst. The target catalyst may not be as good as hope resulting in an AIM sell off with decent losses if your entry is wrong


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