Should You Buy Totally Plc, Challenger Acquisitions Ltd & Nostra Terra Oil and Gas Company plc Today?

Are Totally Plc (LON: TLY), Challenger Acquisitions Ltd (LON: CHAL) and Nostra Terra Oil and Gas Company plc (LON: NTOG) worth buying today?

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

How should you react to today’s moves by  three small-caps? Should you buy, sell or hold? 

Sizeable acquisition 

At time of writing shares in Totally (LSE: TLY) are down by 10% on the day after the company announced that it had agreed to acquire Premier Physical Healthcare Ltd for up to £6.8m. Only £372,000 of the deal total is to be paid upfront, the rest will be paid through four potential deferred payments to 2019, dependent on performance targets. To fund the transaction Totally is the issuing 10m new shares to raise a total of £6.2m.

Premier is a private UK-based provider of physiotherapy, podiatry and ergonomics services. Unfortunately, Totally didn’t publish any financial details about the deal other than the price in today’s press release, so it’s difficult for investors to judge how the acquisition will benefit Totally and if the company is overpaying.

What’s more, it is unclear how Totally’s acquisition of Premier will affect the group’s goal of being profitable during 2016. The company was targeting maiden profitability for the fourth quarter of 2015, but it’s not yet clear if this objective has been hit. 

Until there is more clarity on Totally’s financial position and outlook, it might be wise for investors to take a backseat.

Hard to value 

Shares in Challenger Acquisitions (LSE: CHAL) have jumped by 15% today, although there is little in the way of news to explain these gains. It’s been a rocky year so far for the company’s shares. Last week shares in Challenger were down 41% since the beginning of the year, but still up 35% year-on-year.

Whether or not Challenger is a suitable investment remains to be seen. The company’s shares were suspended from trading at the end of last year but returned to trading after Challenger completed its acquisition of Starneth, a Dutch engineering company and its investment in the New York Wheel Project — a 630-foot high observation wheel to be constructed in New York. 

No City analysts currently cover the company so it’s difficult to value the shares at present.

Just in time 

Nostra Terra Oil and Gas’s (LSE: NTOG) shares have jumped by more than 40% today after the company announced that it had appointed Strand Hanson Limited as nominated & financial adviser and joint broker to the company, with immediate effect.

It was revealed yesterday that Nostra’s original nomad, Sanlam Securities UK, was intending to cease its nominated adviser and small cap broking activities and, as a result, Nostra had until today find a new nomad before its shares were suspended from trading for a month. Now that the company has found a replacement, its shares will be allowed to continue to trade.

Nostra has been taking advantage of the recent oil price slump to acquire a number of producing assets around the world. Only time will tell whether or not this is a sensible strategy. This isn’t a stock for widows and orphans, but if you’re willing to take the risk Nostra could be a rewarding play on an oil price recovery.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Rupert Hargreaves has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

Investing Articles

3 ideas to help investors aim for a million-pound Stocks & Shares ISA

The UK has a growing number of Stocks and Shares ISA millionaires, and this plan may be one of the…

Read more »

Illustration of flames over a black background
Investing Articles

2 red-hot UK growth stocks to consider buying in April

These two growth stocks are performing well, but can they continue to deliver for investors through 2024 and beyond?

Read more »

Charticle

Is JD Sports Fashion one of the FTSE 100’s best value stocks? Here’s what the charts say!

The JD Sports Fashion share price remains a wild ride during the first quarter. Could it be one of the…

Read more »

Investing Articles

Could the JD Sports Fashion share price double in the next five years?

The JD Sports Fashion share price has nearly halved in the past five years. Our writer thinks a proven business…

Read more »

Bus waiting in front of the London Stock Exchange on a sunny day.
Investing Articles

If interest rate cuts are coming, I think these UK growth stocks could soar!

Falling interest could be great news for UK growth stocks, especially those that have been under the cosh recently. Paul…

Read more »

Investing Articles

Are these the best stocks to buy on the FTSE right now?

With the UK stock market on the way to hitting new highs, this Fool is considering which are the best…

Read more »

Petrochemical engineer working at night with digital tablet inside oil and gas refinery plant
Investing Articles

Can the Centrica dividend keep on growing?

Christopher Ruane considers some positive factors that might see continued growth in the Centrica dividend -- as well as some…

Read more »

Smiling family of four enjoying breakfast at sunrise while camping
Investing Articles

How I’d turn my £12,000 of savings into passive income of £1,275 a month

This Fool is considering a strategy that he believes can help him achieve a stable passive income stream with a…

Read more »