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Director Trades on the JSE : 6 Dec 2013 |
(Background reading : executive director transactions in shares)
6 Dec 2013. Today the only director trade which interested me was :
Guy Toms |
Bought some 167,044 shares in Prescient at R0.80 |
Guy Toms is a man who knows what he is doing. He is Prescient's chief investment officer - a man who not only has an intimate knowledge of Prescient, but who also knows how to spot a good investment. Although, it's not clear exactly how significant R134k is to him.
In the 6 months to 30 Sep 2013 Prescient generated a profit of R59m before tax from financial services and R19m before tax from IT services. Prescient Ireland, which was sold on the 15th November 2013 subject to regulatory approval, had a loss of R38m.
Prescient reported that most portfolios were ahead of their benchmarks in the most recent 6 months. Significantly, a contract was signed with RE:CM to administer all their portfolios.
Excluding the contract with RE:CM, I estimate that Prescient is trading more or less at their fair value. So, whether to invest or not seems to depend on whether the contract with RE:CM provides a sufficienly large margin of safety. It is a bit of a concern that the IT Services business is facing increasingly competitive markets.
My initial feel is that Prescient's margin of safety is not quite high enough to invest yet, but I will be keeping an eye on this stock.
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