Interactive Investor

AIM share tips review 2022: playing the long game

22nd December 2022 13:03

by Andrew Hore from interactive investor

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After outperforming in 2021, a bad 12 months for small-cap shares is reflected in these five tips, but award-winning AIM writer Andrew Hore hasn’t given up on these exciting companies.

Wheel of fortune 600

The 2022 AIM recommendations performed particularly poorly with three of them more than halving. In fact, the average decline was 47.4%, which is worse than the one-third slump in AIM during the year.

Over optimism about the short-term potential for most of the companies was the main reason behind the poor performance, although even the two companies that traded strongly still had declining share prices.  



Sureserve (LSE:SUR) is the best performer of the five companies, but the share price is still down on the level at the start of the year. The compliance and energy services business has large, contracted revenues and strong potential.

Profit forecasts have been maintained throughout the year at around £8.2 million, although the revenue mix was different, and the 2021-22 figures will be published on 24 January. Cost pressures have been offset by greater efficiency.

A decision was also made early in the year to stop paying dividends. Net cash of more than £23 million will help to fund acquisitions. The focus is profitable renewable energy-related businesses and bolt-on purchases for the gas and other maintenance operations. There will be continued organic growth and a focus on social housing and operations with large customers, such as meter installation.

The fire and lift services businesses are both non-core although management will not sell without obtaining a good price. These disposals could provide further cash for acquisitions, and they continue to be cash generative as part of the group.

The order book was 16% higher at £585 million at the end of September 2022. Sureserve continues to win orders and the latest is a £5.4 million PV order from the MoD.

The shares are trading on less than 10 times 2022-23 prospective earnings. The share price will eventually reflect the strength of the business and its cash generative abilities. Buy.

IG Design Group


I thought that trading at gift wrap and craft products supplier IG Design Group (LSE:IGR) would recover in the second half of 2022 and it did, but there was more bad news earlier in the year that led to a sharp share price decline in the first half. I was too optimistic that the bad news was out of the way, and it turned out that cost increases were sharper than expected. A new chief executive is in place and the outlook is more positive.

The latest interim figures were relatively good. Pre-tax profit was 35% ahead at $27.4 million, thanks to an 8% increase in revenues to $521.2 million and an improvement in gross margin. Low margin business with independent retailers was shed and the focus was on larger retailers where business continues to be won. It should be noted that orders came in earlier this year so that could hold back second-half revenues.

The Americas and international divisions both increased their revenues, but most of the profit growth came from the smaller international business. There is more to come from the Americas, with further benefits from the rationalisation of activities.

Guidance was upgraded at the time of the interims. IG Design is on course to make a small full-year pre-tax profit, but there is still caution about the global economy and inflation. IG Design is the only one of the five AIM companies where the share price is higher than at the end of June. I believe there is further recovery to come.


Tip price (p)

Share price at 30 June 2022 (p)

Change in first half of 2022 (%)

Share price at 16 December 2022

Change in 2022 (%)







eEnergy Group






IG Design






Shield Therapeutics















AIM All Share



FTSE 100



Shield Therapeutics (STX)


Shield Therapeutics (LSE:STX) has been a big disappointment. Iron-deficiency treatment Accrufer has been on sale in the US for 17 months and revenues are modest. It was too optimistic to think that the company could build up these revenues more rapidly. Accrufer is a good product but Shield Therapeutics has not done well in brining it to the attention of the relevant doctors.

Management has signed a co-promotion and co-marketing agreement with Viatris in the US for Accrufer. There is an upfront payment of $5 million and a revenue split of 55%/45% between Shield Therapeutics and Viatris with the same split for marketing costs. There are also milestone payments of $7.5 million if annual net sales reach certain levels, the first of which is $100 million/year.

AOP Health has provided an additional $10 million convertible bond investment, while Shield Therapeutics is raising £14.7 million via a placing at 6p a share and up to £3.9 million more via an open offer.

This is a one product company and the cash outflow over the next two years will be enormous. Analysts at finnCap forecast 2023 revenues of £25.7 million, rising to £85.6 million in 2024. Most of the cash outflow will be in 2023 with a modest outflow in 2024.

However, forecasts have proved to be overoptimistic in the past and Shield Therapeutics will need to reassure investors that it can get anywhere near these figures.

There will be net debt by the end of 2023, although this may change if AOP Health converts some of its loan into shares. The AOP Health loan is secured on the US IP of Accrufer. The best hope is that a bidder will come along and pay slightly more than the current share price. There could be some profit in taking up the open offer, but it is risky.

Ebiquity (EBQ) 


Ebiquity (LSE:EBQ) lost all its share price gains from earlier in the year, but trading is good, and it has outperformed many other marketing services providers. The media investment analysis services provider continues to improve its profit and during the year added two earnings enhancing acquisitions, including one that boosted the company’s presence in the US. A share placing raised £15 million before expenses of £1.6 million at 53p a share to fund these two acquisitions

Having returned to profit in 2021, interim figures showed a 5% increase in revenues to £37.2 million. The growth came from the media division, while there was a 9% decline in the analytics and technology division due to a focus on margin, although both divisions increased their profit contribution.

Underlying pre-tax profit jumped from £2 million to £4.7 million, and Ebiquity is on course to achieve a 2022 pre-tax profit of £8 million. It could be more than £11 million next year. The shares are trading on less than nine times prospective earnings, falling to less than seven for 2023.

Trading conditions are tough, but forecasts have been maintained. Advertisers want to ensure they are spending their money wisely and that is where Ebiquity comes in. Even if, next year proves tougher than expected Ebiquity is cash generative and has a strong position in its market. Undervalued.

eEnergy Group (EAAS)


Energy efficiency as a service provider eEnergy Group (LSE:EAAS) disappointed investors with forecast downgrades during the year. There is undoubtedly demand for its energy-as-a-service offering and the business is growing, but the recent funding has knocked the share price. Revenues are growing, but contracts have been delayed and it is taking longer than expected to collect cash.

eEnergy recently raised £2.5 million of subordinated debt lasting until 2024, which was issued at a discount. That discount equates to a 2% repayment fee and 1.25% interest each month. Existing shareholder Hawk Investment, another company owned by John Foley, who will become a non-executive director, and eEnergy directors are providing the debt. There will be 42.1 million warrants with an exercise price of 6p, which was the market price at the time, issued to the lenders.

In the year to June 2022, revenues were 63% higher at £22.1 million, while pre-exceptional profit was £1.6 million. First-quarter revenues were 90% ahead at £7.6 million, so eEnergy is well on its way to forecast 2022-23 revenues of £31 million. A doubled pre-tax profit of £3.07 million is currently forecast. Contracted revenues are worth £28.5 million.

The long-term outlook for eEnergy is good, but the results consistently undershoot expectations. Progress is being made, but it is slower than previously expected.  If this year’s forecast is achieved, then the prospective multiple is less than four. That is too low. Buy for recovery.

These articles are provided for information purposes only.  Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties.  The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.


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