CGO - CPT Global

[Jackass]

Did not see a thread for this company so thought I would start one. Has anyone else looked at these? Got to say there is enough there on first glance to make me dig a bit deeper and try to understand the business a bit better.

IT services and consulting so not your standard specy junior mining explorer that you usually find at this end of the market. They also have revenue, profit and dividends which make them rarer still.

Super micro cap of approx $25 mill. Just over $4 mill cash in the bank. No Debt. Founder and insiders hold approx 40% of the company. Has used the money made in the last year to pay off its debt and pay its creditors. Has kept the dividend payout ratio to a sensible level. Price looks reasonable to me, despite a recent run.

So I guess my question is: Any IT experts out there that have an opinion? What makes this company different from any other IT consulting mob out there? Anyone ever worked for them? Any and all opinions and insights appreciated.

 

[divs4ever]

yes i hold CGO bought in February 2015 @ 57c

i probably made the wrong choice by not averaging down when it dipped below 17c .. but i didn't i parked the cash elsewhere

i have invested in different IT stocks ( DTL , GTK , HSN TNE for example ) and have done MUCH better ( even if i had grabbed a truckload @ 17c )

BUT it might be finally getting some traction ...

take care

there are some BIG predators prowling and some are buying up mining projects ( so don't pay too much )

what makes them different ???
they are a small cap,mining services company that HASN'T gone broke and is probably low debt .. tell that to BLY ( and a few others )

this SHOULD be the mining consolidation phase ( where the cashed up players take over cash-starved weaker players ) but maybe that isn't so yet

 

[Jackass]

Sorry @divs4ever , Mining Services & Mining Projects? Do you mean IT?

As far as I can tell CGO don't really do any work for the miners. Their client list is mainly banks, insurance and gov agencies. See below taken from their investor presentation.

I understand what you mean about not paying to much for these. At the moment this is only a small starter position for me until I understand this a bit better. Microcaps can be VERY volatile.

 

[divs4ever]

CPT GLOBAL LIMITED (ASX: CGO) 23 February 2022 AMENDED APPENDIX 4D FOR THE HALF YEAR ENDED 31 DECEMBER 2021

Following is an amended Appendix 4D that corrects two errors in the Appendix 4D lodged on 22 February 2022.
In the Key Information section:
1. the description of the movement in net profit before tax has been changed from ‘up’ to ‘down’; and
2. the description of the movement in net profit after tax has been changed from ‘up’ to ‘down’.
There are no changes to the results announced. This ASX Announcement has been approved for release by the Board of CPT Global Limited.

DYOR

i hold CGO

NOT a confidence builder for a company specializing in banking software

 

[divs4ever]

it think they started with mining IT services , many moons back , however whether or not they switched to banks , it hasn't helped them a great deal , they have gone basically nowhere since 2015

 

[darien44]

I was playing around with some filters and this caught my eye. Can't say I have much understanding of how they make money. However, they are a debt free, capital light company that have about 80% of the world's biggest banks as a customer. They are trading at a P/E of just 10 and the dividend yield is currently 7%. ROIC and ROE for 2021 and 2022 looked very good, however previous years were pretty erratic.

 

[divs4ever]

I was playing around with some filters and this caught my eye. Can't say I have much understanding of how they make money. However, they are a debt free, capital light company that have about 80% of the world's biggest banks as a customer. They are trading at a P/E of just 10 and the dividend yield is currently 7%. ROIC and ROE for 2021 and 2022 looked very good, however previous years were pretty erratic.

erratic is very polite

however for maybe a small dabble ( i have held CGO for several years )

now one potential issue might be the banks themselves and how they handle the next couple of years

( think of how WOW has treated small companies they have a relationship , i would expect some banks to follow a similar model )

 

[darien44]

erratic is very polite

however for maybe a small dabble ( i have held CGO for several years )

now one potential issue might be the banks themselves and how they handle the next couple of years

( think of how WOW has treated small companies they have a relationship , i would expect some banks to follow a similar model )

Yes, not something I would consider putting more than a trivial amount of money into, but given the price and nature of the business I think it is worth keeping an eye on.

I found some interesting commentary from Peter Johns, who owns this through his small cap Westferry fund.

He points out that large companies, who are still required to maintain their own internal mainframe systems use CPT for security reasons.

They are not strongly reliant on any one company, and there is a dwindling number of firms that can do what CPT do. Certain companies will continue to need to maintain an internal mainframe in the coming decades rather than switching to the cloud and this is where CPT will be at an advantage.

 

[divs4ever]

Yes, not something I would consider putting more than a trivial amount of money into, but given the price and nature of the business I think it is worth keeping an eye on.

I found some interesting commentary from Peter Johns, who owns this through his small cap Westferry fund.

He points out that large companies, who are still required to maintain their own internal mainframe systems use CPT for security reasons.

They are not strongly reliant on any one company, and there is a dwindling number of firms that can do what CPT do. Certain companies will continue to need to maintain an internal mainframe in the coming decades rather than switching to the cloud and this is where CPT will be at an advantage.

as a computer hobbyist , owning your own server-farm has it's charms , however the 'cloud ' has it's uses as well ( not everyone loves tape-servers for back-up archives )

of course one might ask where the banks themselves will be in the future given the push for CBDCs ( if your Central Bank is controlling the currency movement do you really need a bank )

BTW i still hold these , just splashing some reality into the mix

cheers