Avingtrans (AVG) : Corp

Upbeat trading update

Key data

  • Share price (p) 307.5
  • Target price (p) 300.0
  • Market cap (£m) 96.4
  • Enterprise value (£m) 98.5

In a brief trading update, the company confirms it is trading in line with market expectations, having continued to perform well in the first half. The order book and pipeline prospects remain robust, and good progress has been made with the Energy Steel and Booth acquisitions. The shares have performed strongly over recent months, helped by contract wins, and are now close to our 300p price target, but we remain supportive.

David Buxton 020 7220 0542 dbuxton@finncap.com

Surface Transforms (SCE) : Corp

Transforming the high performance brake market

Key data

  • Share price (p) 26.8
  • Target price (p) 30.0
  • Market cap (£m) 36.5
  • Enterprise value (£m) 35.7

SCE has developed carbon-ceramic brake discs for the high performance vehicle market that have significant technical and performance advantages over the existing (near monopoly supply) product from Brembo. SCE has now won milestone OEM production contracts, proving the commercial case and providing revenue visibility. We believe that FY2020E is likely to bring a stream of new OEM production contracts, providing further support to our investment case.

Raymond Greaves 020 7220 0553 rgreaves@finncap.com

Avacta (AVCT) : Corp

Positive 17-month trading update

Key data

  • Share price (p) 18.1
  • Target price (p) 76.0
  • Market cap (£m) 31.8
  • Enterprise value (£m) 23.1

Avacta released a positive trading update for the 17 months to 31 December, with revenues and cash both £0.4m higher than we expected (8% and 5% higher, respectively). This was driven by customer Affimer evaluations and services relating to its partnership programmes, which in turn drove year-end cash. Avacta continues to build value into the business by progressing its proprietary therapeutics assets and partnered programmes, which now extend to four (Moderna Therapeutics, LG Chem, ADC Therapeutics and Daewoong Pharmaceutical). Its focus remains on taking its first pre|CISION pro-drug (pro-doxorubicin) into the clinic in mid-2020, with first data expected by year-end. We maintain our target price of 76p.

Mark Brewer 020 7220 0556 mbrewer@finncap.com

Europa Oil & Gas (EOG) : Corp

Irish farm-out update

Key data

  • Share price (p) 2.6
  • Target price (p) 14.0
  • Market cap (£m) 11.6
  • Enterprise value (£m) 8.7

Europa’s farm-out negotiations with a Major oil company for three of its Irish offshore licences have been terminated. This is disappointing, but not unexpected, given these discussions have been ongoing for more than 12 months. All is not lost though, as discussions with several other parties continue. In particular, Europa remains upbeat on the likelihood of a deal for its Inishkea prospect on FEL 4/19 in the Slyne basin. This prospect is large, low risk, gas not oil, and adjacent to the producing Corrib gas field infrastructure. As a result of this we are raising the commercial risking on Europa’s acreage within our NAV. This has an impact and sees our risked-NAV and price target fall from 32p to 14p/sh. Inishkea accounts for 3.3p/sh of this, which if fully de-risked would rise to 18.5p/sh, demonstrating the material potential still offered within the portfolio.

Jonathan Wright 020 7220 0543 jwright@finncap.com

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