On the lookout for the best UK shares for my portfolio, I pay attention when insiders own lots of shares in a firm. This seems to be the case with TPXimpact Holdings (LSE:TPX). Should I look to add some shares to my holdings too? Let’s take a closer look.
IT services provider
There is a high likelihood you may not have heard the name TPXimpact Holdings before. This is because until late last year, the company was known as Panoply. TPXimpact provides IT services to governmental departments, the public sector, and charities. It does this through the use of cutting edge AI-driven technology.
TPXimpact only floated on the FTSE AIM in late 2018 for just over 80p per share. As I write, shares are currently trading for 242p, which is close to a 200% increase! In 2021 alone, the shares increased by 25%. With insiders owning shares and some clear momentum, let’s decide if I should add some shares to my portfolio.
For and against
FOR: TPXimpact’s management team is a positive for me. It was founded by entrepreneur Neal Gandhi and Oliver Rigby. Gandhi has experience of tech firms as he previously co-founded four firms and sold them for a healthy profit. He is also the largest shareholder in TPXimpact. When insiders own shares, this buoys my own investment case. Those running the firm usually invest their money if they believe the share price is on the rise and performance will match it.
AGAINST: Competition in the IT and tech world is intense. There are many UK shares that offer me exposure to the tech world. Some of these are better known and more established with similar technology solutions. There is always the chance that established firms can out muscle and outmanoeuvre smaller lesser known firms like TPXimpact.
FOR: TPXimpact has a history of acquisitions. I particularly like firms that acquire competitors and other firms to enhance their own offering and boost their own chances of success. Most recently TPXimpact acquired RedCortex Ltd which offers access to the Welsh public sector market as well as its proprietary knowledge and software. TPXimpact’s performance has been impressive recently too. This was signified by a interim report released in December. It reported that revenue increased by 77% for the six months ended 30 September. It also confirmed profit was up compared to the same period last year. A healthy cash rich balance also led to an interim dividend.
AGAINST: Gandhi has a history of building up and selling companies. Could this happen with TPXimpact? If so, would the firm’s momentum be the same in terms of performance and returns? This is a credible risk I must be aware of.
A UK share I like
Overall, I like TPXimpact Holdings. At current levels I would add shares to my portfolio. The digital revolution is in full effect and TPXimpact seems to have created a market for itself by providing important tech for the public sector. Key people in the firm have experience in guiding tech firms towards success and performance and acquisitions are on the up too. The outlook ahead is exciting.
