Clearly overdue for a re-rating upwards are the shares of Amstrad Plc, which have been dull-as-ditchwater of late for no sound fundamental reason.Analysts and investors began to take the UKP130m pre-tax for the year just ended for granted instead of acknowledging the enormous advance it represented, but Amstrad shares finally started recovering lost ground yesterday […]
Clearly overdue for a re-rating upwards are the shares of Amstrad Plc, which have been dull-as-ditchwater of late for no sound fundamental reason.Analysts and investors began to take the UKP130m pre-tax for the year just ended for granted instead of acknowledging the enormous advance it represented, but Amstrad shares finally started recovering lost ground yesterday after the electronics team at Chase Manhattan Securities again pointed out some of the pluses. They expect Alan Sugar to unwrap something a little better than UKP130m pre-tax next month, and are going for UKP140m, putting the shares on an historic price-earnings ratio of 10, and a prospective multiple of only 7, but what does Sugar have up his sleeve to rekindle the market and get the pot bubbling for the year just started? Perhaps the most promising of all is the faster-than-expected march of satellite broadcasting in Europe where Amstrad is looking to introduce cheap satellite dishes early next year for the pan-European Astra system – a sort of multichannel TV Radio Luxembourg. If the bird flies successfully, the service will get under way very quickly, and the potential volume for the dishes is enormous. On the computer front, an integrated desk-top publishing system including an Amstrad laser printer – taking the concept of the personal word processor one step further, is a strong possibility. We’re not at all comfortable with suggestions of an 80386 machine early next year – the chips are not freely enough available and are still too expensive, and 80386 boxes are nowhere near a mature market yet – but a mass-market 80286 machine at the Which Computer? show at the beginning of next year looks a strong possibility. And in the meantime, lest anyone has forgotten, Amstrad at last does have serious retail muscle behind the PC1640 Personalike in the US, now that Dixons has decided to stock the thing in its newly-acquired US consumer electronics stores. That decision represents a very clear vote of continuing confidence in Amstrad’s computers by the premier UK electrical retailer. All of which was good for an 8p jump in Amstrad’s shares to 171p.
