Arcam AB fka AMAVF

[Nobahamas]

swedish blogger Labull on redeye.se:
http://www.redeye.se/aktiebloggen/arcam/arcam-tankar-om-insiderforsaljning-och-annat

Google translate:
Arcam: Thoughts on insider sales and other

Blog entries written by:
LaBull (Member) 2015-03-03 12:02

As CEO Magnus Rene sold shares for SEK 17 million last week. Is it a negative signal? The motivation for the sale is "risk-spreading", which sounds good to my ears, but is an excuse often used. Naturally share sensitive to this type of sales because the valuation is high and is based on hopes of strong future growth.
Personally, I rarely put much emphasis on insider sales. Mr. Rene took before the sale of shares at a value of nearly 30 million and options on a further 400,000 shares with an exercise price of SEK 19, SEK 93 and 310 crowns.
Should I be worried about the growth outlook has worsened? No, I think.
1. Arcam recently reported a record profit in Q4 and orders said to be a "run-rate on one machine a week," according to CEO's comments on the conference call. It has been confirmed that GE will use EBM in its GEnx engine. Media Reports confirms that even Rolls Royce and Pratt & Whitney are customers of Arcam with great confidence in the technology. As the world's three largest manufacturers of aircraft engines with a combined market share of type 99% are customers of Arcam.
2. In the annual report published yesterday quantified Arcam potential for the two focus markets orthopedic implants and aerospace, see page 15;
"Arcam The potential for the company EBM system is significant in orthopedic implants. Currently, Arcam has delivered 65 systems for implant production potential is estimated to be several thousand installed systems"
"Arcam estimates that the aviation industry has an even greater potential and market believed to eventually amount to tens of thousands of installed systems, compared with the 60 systems delivered to and including 2014.
3. 3D Systems reported its fourth quarter last week. 3D Systems tillevrkar mainly 3D printer that uses plastic, which has no relevance to the Arcam, but DDD owns a subsidiary called Phenix Systems, which manufactures metal printers. The growth of this subsidiary was 175% in 2014 and CEO of DDD am extremely excited to tillväxtmöjlighterna described as "open ended", roughly translated as "boundless.
4. Sector colleague SLM Solutions, updated in late January, orders received for 2014. It took orders for 62 machines, compared to 26 the year before, ie 138% growth.
So arrows pointing up wherever you look, except in the course graphs. Arcam did a jerk 145-195 in January but has leveled out and corrected by almost 10% since then.
Given that the potential is set to "thousands" and "tens of thousands" system in the long term, I think that a PE ratio of 45-50x for the 2015 expected earnings (Arrangement VPA 3:54 crowns, consensus GAAP EPS 4.07) feels fully affordable .
I have raised my own forecasts for Q4 report and now expects 580 million revenue in 2015 and an EPS of SEK 4, and 720 million for 2016 with a VPA at 6 crowns.
Arcam remains one of my major long-term holdings.