Investment summary

Cenkos Securities is a corporate-finance specialist focusing on raising finance for already-quoted growth companies, resources and investment funds. It has a modest institutional stock-broking operation and wealth management business having sold down its stake in the offshore wealth management business in April 2012 to 10%. In its niches it is well regarded, has manageable competition, and generates high and relatively stable returns. The group generated good returns in 2011. Remuneration and capital management policies are key differentiators from other small brokers.

Last updated on 23/04/2012

Industry outlook

Near-term market volatility/weakness is unhelpful to both market making and corporate activity, although further capital raisings on AIM (the company's core) has been relatively robust. Industry trends are squeezing commission margins. However, these trends are also seeing weaker competitors exit the market, and much of the company's business is too specialist for bulge bracket players.

Last updated on 23/04/2012