The City is taking a more upbeat view of digital satellite products firm Pace Micro Technology after a visit to the plant in Saltaire, Yorkshire, by analyst Tressan MacCarthy.
Pace is strongly tipped as a front-runner for BSkyB’s set-top digital decoder, and brokers believe the political and regulatory delays holding up orders explains a blip in Pace’s share price.
After her visit to Saltaire, MacCarthy, of broker Panmure Gordon, lifted her estimate for the year to next May by 12% to £29.3million pre-tax (against £18.2million last year) to reflect `stronger than expected progress’.
The company’s shares scored a 16% gain in first day dealings on their stock market launch last summer -and later extended the gain to 40% at one time.
They were trading some 6% down from their best at 228p, but City fans see that as a buying opportunity.
A year ago Pace had three digital customers: now it has more than 30. MacCarthy, who reckons that Pace will win around 33% of the BSkyB digital business, looks for £10.2million pre-tax profits when it reports interim results later this month. The company only broke even at that stage last year.
The analyst enthuses over Pace’s prospects: `We are just at the start of the digital revolution and it is well ahead of the competition.’
Pace aims to stay ahead and has already developed and sold an ADSL product -the box of tricks which gets video down telephone wires.