By Bankside Tipster
A professional investor and trader all his life Bankside has seen it all in the City! Having lived through the dot com boom and the crash of 1987, Big Bang and the recent recession, Bankside brings 30 years’ experience of the ups and downs of the stock market. Well aware that trading is risky and stocks go down as well as up, his thoughts and advice is aimed that the educated investor not the amateur. Bankside is the first to point out that readers should take out professional advice on any investment. All that said his occasional blog brings tips and insight into market trends and shares to watch from an active trader. Good luck!
Shell experts Peter Redmond and Richard Armstrong have taken control of small investment company Pires Investments ("Pires") and, if past performance is anything to go by, Pires could prove to be an exciting near-term investment with the benefit of little obvious downside risk.
Containing cash of approximately £600,000 after its £410,000 recent investment in Rame Energy ("Rame") and with an NAV of over £1.5m – against a market cap of only £1.2 million – Aim listed Pires looks set to build on this initial investment to become an active player in the renewable energy sector which remains a likely beneficiary of increasing government sponsorship.
Pires's first substantial investment, Rame, has already generated an unrealised gain of around 20% and appears to be a well-managed, serious, participant in the wind and solar renewable energy sectors – particularly in the fast growing emerging market of Chile. Rame appears well on its way to achieving its power production targets for 2014/2015 which, according to broker Northland Capital, should see the value of Pires's investment double in the short term if Northland's Rame valuation prediction is correct. In addition Pires has a useful bundle of Rame warrants to add some spice to its investment.
This increase in the value of Rame should add a further £500,000 or approximately 40% to the value of Pires, excluding the possibility that Redmond and Armstrong could well use Pires to acquire a substantial energy company akin to their hugely successful reversal of Igas into KP Renewables. Investors in Igas have seen a tripling of their investment in two years with prospects for Igas's shale activities continuing to look bright.
For a company with a stock market value of only £1.2 million, and trading at a discount of more around 20% to NAV, Pires looks like a low risk bet on two highly experienced shell players that could deliver stellar returns on a short to medium term view. Furthermore, as an additional underpin of value, the Directors only have existing authority to issue new Pires shares at 0.10p per share which is roughly double the current share price. All told, a purchase of Pires shares at anywhere near the current price of 0.0525p per share looks like a real bargain.
For those looking to open a broking account we recommend nationwide stockbrokers Redmayne Bentley who allow investors to open an account over the phone and trade instantly. They can be contacted on 0113 243 6941.
Important information: Tips in this blog are provided by Banksider to Fresh Business Thinking who may not share his views. These share tips are intended as general information only and do not constitute a personal recommendation to invest. They are designed for investors who like to make their own investment decisions. If you have any doubts as to the suitability of investing in shares you should seek expert advice. Please be aware that the value of investments can fall as well as rise so you could get back less than you invest.
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