$CAMK.L – Camkids – markets reels on trading update

CAMK, is a “Chinese designer, manufacturer and distributor of branded outdoor clothing, footwear and equipment for children and teenagers”.

Today it issued a trading update (http://is.gd/WyLgJD), stating that it is “trading in line with market expectations for 2014”. Howerver, it also said: “the Group’s spring/summer order book is approximately 13 per cent. behind the same period last year, lead the Board to adopt a conservative stance towards its prospects for 2015”. This sent the shares down 19.4% to 37.50p.

CAMK appeared on Stockopedia’s Greenblatt screen earlier this year, and it was a company that I took a dim view of. Now you can see why. All the signs are there:

  1. It’s a Chinese AIM stock with a short listing history
  2. ROCE of 38.2% is implausibly high
  3. Operating margin of 27.8% is implausibly high
  4. PE of 1.78, suggesting the market knows something that the bulls don’t
  5. Plenty of cash (at least that’s what the accounts say), courtesy of stock issues
  6. Poor share price momentum
  7. Ostensibly a growth company, but at value-investor prices
  8. Poor cash collection, as witnessed by debtor days.

Avoid

37.50p. ASX 3536

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About mcturra2000

Computer programmer living in Scotland.
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One Response to $CAMK.L – Camkids – markets reels on trading update

  1. Pingback: Nov 2014 | Mark Carter's blog

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