I thought I would feature a few of these for you to think about. I have written in the past about on one called Alternative Networks (AN.) (£219m market cap.) which had a trading update for the half year ended 31 March 2015 today.This read quite well giving the Board confidence that its full year expectations for the Group will be met, which is always a good start. They did talk about a second half weighting to the profits this year, which can be a concern, but they seemed to be suggesting this was due to them winning lots of new larger contracts. Their Advanced solutions and mobile offerings did well and this helped to offset the expected decline in fixed line business. Meanwhile they are busy integrating and rationalising two recent acquisitions. On the back of this they flagged strong cash conversion and reductions in debt both actual and expected and they reiterated their 10% to 15% dividend growth expectations. The only slight negative tone was on one of the acquisitions where they said ControlCircle's performance has been satisfactory. So with that caveat and the second half weighting to profits I guess the H1 numbers may not look that great when they are reported, but I would be confident that this one will deliver in the second half. The shares have drifted back from their highs recently and they have just bounced from an oversold position on the RSI (see chart below - comments continue after chart). Summary & Conclusion The shares look reasonable value on around 14x & 3.5% yield based on current forecasts to September 2015 with a Compound Income Score (CIS) of 65 . This is expected to go to 13x and 4% with the growth forecast for 2016. Seems fine to me but as I say may be the interim may not look that great so other than it being a bit oversold there may not be much of a catalyst for the price in the short term. Otherwise there is a surprising large amount of choice in the Small Telecom company space in the UK. I have also written in the past about KCOM (£470m market cap.) which I flagged up back in January this year when it had fallen to less than 80 pence and offered a yield in excess of 6%. Just to note it has now risen towards my 100p target to reach the low 90p's but still trades on around 12x with a yield around 6%, CIS = 82 Others have mentioned to me Manx Telecom (MANX) (£200m market cap) which has reported Final results today. Not one I have looked at in detail but as the main provider in the Isle of Man I can see the attractions as it also trades on around 14x with a 5.5% yield for this year, CIS = 14 (maybe reflecting short history as it only listed recently). Other choices in this area include the much smaller Adept Telecom (ADT) (£36m market cap.) which seems to be on around 11x with a 3% or so yield, CIS = 93. It is expected to grow strongly and favoured by former colleague John Rosier in his Investment Portfolio which you can read about here. Finally another small one that has scored well for a while with a CIS of 96 is Maintel Holding (MAI) (£71m market cap.) which is also on around 11x but with a 4% yield and strong forecast growth although when I checked it out it didn't seem that liquid and the spread was horrendous. So there you go plenty to choose from in this space and as I always say you pay your money and take your choice and do your own research. Puts me in mind of an old song and as 70's retro is all the rage these days look out for some classic clothes and disco dancing oh yes and Debbie Harry in this video to brighten up an otherwise dull Tuesday.
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