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Hi Everybody,

Our alert for Tuesday:
Volex
Exchange – LSE
Symbol – VLX
Last trade – 81.00p

• Volex has announced full-year results that are in-line with our expectations.

• In our view, the numbers reflect the failure of the previous management to adapt to the requirements of its customers.

• Nevertheless, we note that the new management team is making good progress, with revenue growth now being delivered and additional cost savings expected.

• In fact, revenue in the first two months of FY15 is 13% higher than the comparable period and factory loading for Q1 indicates that revenue for the quarter will be 10% ahead on the prior year and 4% ahead on the previous quarter.

• In addition, gross margins in the first month of FY15 are better than expected and the order intake in the higher margin product areas provides further confidence that this will continue.

• Accordingly, we are keeping our forecasts unchanged and maintain our stance of buy, with a target price of 245p.

As always, do your own research, don’t chase gaps, use limit orders to enter positions, always use stop loss orders to protect your position, and take profits when you are in a position to do so.

Good Trading