Gamble of the week Niche electronics distributor – MoneyWeek

Asaresult,thefirmhasmovedbackintotheblack,focusedmoreondifferentiatedareasandexecutedaseriesofsmartacquisitionsofspecialistsuppliers。

ThelastonewasconcludedinOctober,whenAcalpurchasedMTC,aGerman-basedelectromagneticshieldinggroup,for€3。

4m。

Thedealshouldbeimmediatelyearnings-enhancing。

Atthesametime,Jefferiesconfirmedthattradingwasontracktomeetexpectations,andthatheexpected“increasedprofitabilityinthefirsthalfyear”。

Acal(LSE:ACL)

BrokerOrielSecuritiesispredictingturnoverandunderlyingearningspershare(EPS)of£290mand23。

5prespectivelyfortheyearendingMarch2012–risingto£310mand31p12monthslater。

Iratethestockonaninetimesearningsbeforeinterest,taxandamortisation(EBITA)multiple。

Adjustingforproformanetcashof£3。

7manda£5。

5mpensiondeficit,thatgeneratesafairvalueofabout£2。

75ashare。

Ofcourse,therearerisks。

Akeyoneismaintainingthecompany’sstrongmomentumamidthemoreaustereeconomicconditions,includingthethreatofpricedeflation,insouthernEurope。

Thatgeographicareacontributes28%toAcal’sgrouprevenues。

Thefirmmustalsodealwithincreasingcompetitionandforeign-exchangefluctuations。

Allthesame,withasolidbalancesheet,adecentdividendyieldat3。

6%andyearsofexperiencenegotiatingdownturns,Acalisasoundplayforthemoreadventurous。

Interimsaredueouton28November。

Rating:SPECULATIVEBUYat210p(marketcapitalisation£61m)?

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