11.03.2025
On Monday 17th March this world-leading technology group will be declaring its results for the year to end-December 2024.
Yesterday, after a weekend press mention, the shares of MTI Wireless Edge (LON:MWE) rose 10.60p at one stage, to touch 69.60p – which was well over my Target Price of 62p set just six months ago.
They closed last night at 62p, after a busy day’s dealing volume some 14 times the normal daily average.
Do I see them going higher?
Yes, I do – despite it being a small company, it is a world leader in various of its markets and it has a global arena in which to display and then sell its wares.
The Business
Founded in 1970, the now £55m-capitalised MTI has grown into a global provider of comprehensive radio frequency communication solutions that serve top-tier customers worldwide.
MTI’s innovative technology solutions meet the growing demand for next-generation 5G networks, that address global warming and climate change, and strengthen defence communications.
The Israel-based group is a technology group focused on comprehensive communication and radio frequency solutions across multiple sectors.
The group operates through three core divisions: Antenna; Water Control & Management; and finally, the Distribution & Professional Consulting Services division.
The Antenna division
MTI is a world leader in the design, development and production of high-quality, state-of-the-art, and cost-effective antenna solutions including Smart Antennas, MIMO Antennas and Dual Polarity Antennas for wireless applications. MTI supplies antennas for both military and commercial markets from 100 KHz to 174 GHz.
Internationally recognised as a producer of commercial ‘off-the-shelf’ and custom-developed antenna solutions in a broad frequency range, MTI addresses both commercial and military applications.
MTI supplies directional and omnidirectional antennas for outdoor and indoor deployments, including smart antennas for 5G backhaul, Broadband access, public safety, RFID, base station and terminals for the utility market.
Military applications include a wide range of broadband, tactical and specialised communication antennas, antenna systems and DF arrays installed on numerous airborne, ground and naval, including submarine, platforms worldwide.
The Water Control & Management division
Via its subsidiary, Mottech Water Solutions, MTI provides high-end remote control and monitoring solutions for water and irrigation applications based on Motorola's IRRInet state-of-the-art control, monitoring and communication technologies.
As Motorola's global prime-distributor Mottech serves its customers worldwide through its international subsidiaries and a global network of local distributors and representatives.
With over 25 years of experience in providing customers with irrigation remote control and management, Mottech's solutions ensure constant, reliable and accurate water usage, increase crops quality and yield while reducing operational and maintenance costs providing fast ROI while helping sustain the environment.
Mottech's activities are focused on the market segments of agriculture, water distribution, municipal and commercial landscape as well as wastewater and storm-water reuse.
The Distribution & Professional Consulting Services division
Via its subsidiary, MTI Summit Electronics, MTI offers consulting, representation and marketing services to foreign companies in the field of RF and Microwave solutions and applications including engineering services (including design and integration) in the field of aerostat systems and the ongoing operation of Platform subsystems, SIGINT, RADAR, communication and observation systems which is performed by the Company.
It also specialises in the development, manufacture and integration of communication systems and advanced monitoring and control systems for the Government and defence industry market.
Recent Contract Win
On Wednesday 12th February, the group announced that its Antenna division had received a significant repeat order from a system house in Israel for the manufacture of military antennas worth some $4m, which are expected to be delivered up until 30th June 2026.
At that time CEO Moni Borovitz stated that:
"We are thrilled with this repeat manufacturing order as it is one of the largest orders we have ever received and demonstrates our ability to deliver high-quality services and innovative solutions to meet our clients' needs.
The order entails the supply of state-of-the-art antennas and is integral to an end use which is considered to be one of the most advanced systems of its kind in the world.
The antennas are designed to deliver unmatched accuracy and robust communication, leveraging our sophisticated and complex production technology.
This win and others like it, add to our growing reputation for providing highly innovative antenna solutions and we look forward to continuing to work closely with defence companies from around the world."
The Equity
There are some 88.54m shares in issue.
The larger holders include the Borovitz family (33.11%), the Beer family (11.19%), Directors etc (6.44%), Herald Investment Management (5.17%), Premier Fund Managers (5.10%), Canaccord Genuity Wealth (2.17%) and Chelverton Asset Management (1.60%).
Broker’s View
Research analyst Rob Sanders, at Shore Capital Markets, has a ‘Fair Value’ estimate on the group’s shares at 80p.
His estimates for the year to end-December 2024 are for $48.2m ($45.6m) revenues, with adjusted pre-tax profits of $4.9m ($4.8m), earnings of 4.5c (4.6c) and paying a dividend of 3.3c (3.1c) per share.
With that year’s net cash position of $9.3m ($8.1m) at the year-end.
For the year now underway he looks for $51.5m revenues, $5.2m profits, 4.7c earnings and a 3.4c dividend.
With this year’s net cash position of estimated at $10.1m at the year-end.
Into the 2026 year he suggests revenues of $55.0m, $5.6m of profits, 4.9c earnings and a dividend of 3.6c per share.
With the 2026 net cash position of $11.1m at the year-end.
My View
I have no doubt that this group’s shares are heading a great deal higher.
Hold very tightly to your current positions and if you are not already a holder, then just bide your time waiting to take advantage of inevitable bouts of profit-taking.
(Profile 25.09.24 @ 49.50p set a Target Price of 62p*)
Asterisk * denotes that the Target Price has been achieved since Profile publication.
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