I Read The News Today Oh Boy! 7-Dec-2017

Thursday, Dec 07 2017 by
22

Morning All!

S &U ( S&U (LON:SUS) ) – 2420p – £290.2m – PER 10.4

Trading Update For The Period 1st August To 6th December 2017 – Demand for products remains robust.

There’s quite a lot to like here (except the £81.1m Net Debt, 25%+ of Mkt Cap), I will put it on my Watchlist for now.

Caretech Holdings ( Caretech Holdings (LON:CTH) ) – 426p – £322.6m – PER 12.0

Preliminary Results For The Year Ending September 2017 – Revenue up 11.4% to £166.0m (2016: £149.0m), underlying PBT up by 12.6% to £29.4m (2016: £26.1m), underlying EPS remained at 38.03p per share due to a share placement - Property portfolio valued at £329m.

Seems reasonably priced here but Net Debt remains high at £147.1m (40% of Mkt Cap). That aside it does have attractions.

MJ Gleeson ( MJ Gleeson (LON:GLE) ) – 755p – £407.2m – PER 13.6

AGM Statement – Expecting results for the full year to June 2018 to be broadly in line with results for the prior financial year - H1 results may fall below those of the prior year, in this event, H2 is likely to be significantly stronger than the first. Then it states “The Board, therefore, remains confident that the results for the full year to 30 June 2018 will be in line with expectations”.

I quite like this still but the update is a little strange to me. The first statement is that full year results should be the same as last year and a follow up statement confirms the full year will be in line with expectations. Even just looking at the EPS, it’s supposed to be 52.6 in 2018 versus 48.5 in 2017 – I am confused enough to remain on the side-line for now. Perhaps I’ve missed something here!

Clipper Logistics ( Clipper Logistics (LON:CLG) ) – 426.75p – £421.2m – PER 23.3

Interim Results For The 6 Months To End October 2017 – Headline “Continuing strong growth in line with expectations”. And, I quite like this, Revenue up 21.1% to £199.7m (2016: £164.9m), PBT up 15.6% to £7.9m (2016: £6.9m), EPS up 18.9% to 6.3 pence (2016: 5.3 pence) and the Interim Dividend is up by 16.7% to 2.8 pence per share.

This remains on my Watchlist.

RM ( RM (LON:RM.) ) – 161p – £133.1m – PER 7.48

Trading Update – “Expects results for the financial year ended 30 November 2017 to be ahead of expectations”.

This stock ticks a lot of my boxes, it’s going on my Watchlist, may even take an opening position here this morning as it seems reasonably priced even at this level.

Headlam ( Headlam (LON:HEAD) ) – 526p – £446.3m – PER 12.5

Trading Update For The 10 Months To End October 2017 – Revenue up 1.7% (CC) and overall growth for the year is expected to be marginally lower than planned. PBT expected to be in-line (due to work on margins).

At this valuation with a reasonably well covered 4.5% or so Dividend and a decent cash pile any slip from here could make it even more interesting to income seekers. I am going to add this to my Watchlist (even though the Dividend is not mentioned in this update).

Liking a couple of stocks here this morning, just a wee bit nervous at opening new positions at present, so much sh*t going on in the world (Trump, Brixit, Bitcoin bubble, Chinese market fall, (the cricket) to name a few).

I know Peter Lynch said there's always something to worry about just invest in good companies. BUT it's hard to get over that hurdle sometimes, even when the company is attractive and I am still 25%+ in Cash at present.

Be careful out there!


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S&U plc is a United Kingdom-based company engaged in providing motor finance and specialist lending service. The Company is focused on the specialist motor finance market. The Company's subsidiary, Advantage Finance Limited (Advantage Finance), is engaged in the motor finance business. Advantage Finance offers motor finance to over 100,000 customers in the United Kingdom. more »

LSE Price
2290p
Change
 
Mkt Cap (£m)
270.3
P/E (fwd)
8.5
Yield (fwd)
5.9

CareTech Holdings PLC is a provider of social care services. The Company's segments include Adult Services (Adult) and Children Services (Children). The Adult Services segment consists of the Adult Learning Disabilities (ALD) and Mental Health (MH) divisions. The Children Services segment consists of Young People Residential Services (YPR), Foster Care (FC) and Learning Services (Learning). ALD provides solutions for people living in their own homes, residential care or independent supported living schemes. MH includes a community-based hospital, adult residential care homes, independent supported living and community outreach. FC provides for both mainstream and specialist foster care across England and Wales for children with disabilities. YPR includes facilities for children with learning difficulties and emotional behavioral disorders, and small specialist schools. Learning comprises employment and training services to young people and adults. more »

LSE Price
360p
Change
3.2%
Mkt Cap (£m)
264.2
P/E (fwd)
9.4
Yield (fwd)
3.2

MJ Gleeson plc, formerly MJ Gleeson Group plc, is a United Kingdom-based company, which is engaged in providing two businesses: house building on brownfield land in the North of England and strategic land trading, primarily in the South of England. The Company operates in two segments, which include Gleeson Homes and Gleeson Strategic Land. The Gleeson Homes segment is engaged in house generation and provides homes for sale to low income people in the areas of industrial decline, and social and economic deprivation in the North of England. The Company's Gleeson Strategic Land segment is engaged in land promotion business by securing residential planning consents for lands and focuses on helping landowners to pay for in the South of England. The Company has operations in various regions, such as Cleveland; County Durham; Derbyshire; Greater Manchester; Lancashire; Merseyside; North Yorkshire; Northumberland; Nottinghamshire; South Yorkshire; Tyne & Wear, and West Yorkshire. more »

LSE Price
665.8p
Change
-2.1%
Mkt Cap (£m)
371.2
P/E (fwd)
11.0
Yield (fwd)
4.9



  Is LON:SUS fundamentally strong or weak? Find out More »


7 Posts on this Thread show/hide all

MrContrarian 7th Dec '17 1 of 7
5

My morning smallcap tweet:

Brave Bison (LON:BBSN), Clear Leisure (LON:CLP), People's Operator (LON:TPOP), Inland Homes (LON:INL), HSS Hire (LON:HSS)

Brave Bison (BBSN) Exp FY rev £9.1m, ahead of expectations, and adj EBITDA -£0.9m. But move to higher-margin revenues is slower than originally anticipated, will take longer to achieve profitability.
Clear Leisure (CLP) long account of attempts to recover from various disastrous investments. Has prepared file two legal claims tot £2.5m. One re Italian subsidiary "regarding serious misrepresentations about the company’s accounts, which were used as the primary basis for the investment, and on the day-by-day management of the investment itself by the former owner." The second regards a formerly disposed UK based portfolio investment. Cash situation desperate.
The People's Operator (TPOP) plans placing of 2.8bn shares at 0.1p. That's an 81% discount and 95% to the SP before it announced it was seeking to raise new funds.. Also 1.4bn warrants at 0.2p. Trading is in line. Three years ago on IPO at 130p it had 77m shares. The boards said a key strength was a 'Robust financial model'.
Inland Homes (INL) will buy back up to another 1m shares.
HSS Hire Group (HSS) result of Strategic Review "the most detailed in the company's history, has provided us with deep insights on HSS's trading performance and enabled us to devise a clear and actionable set of priorities." Wait for it. They are to: 1. reduce debt. 2. repair the tool hire business. 3. strengthen the commercial proposition. Plans £10m - £14m of additional savings. Targets EBITDA margin: above 20%. Also will "improved profits in the heritage tool hire business". Is that steam hammers and blacksmith's anvils?

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jonno 7th Dec '17 2 of 7
5

Well done Matylda and Mr Contrarian for your hard work, application and discipline in putting together your daily posts. I hold RM, Headlam and M J Gleeson. General pleased with all three, although surprisingly the update from Gleeson is perhaps the least inspiring.

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herbie47 7th Dec '17 3 of 7
1

The main problem with RM (LON:RM.) is the pension deficit. Otherwise I agree it does look good. I also agree about the markets, the last 3 months have been difficult.

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andrea34l 7th Dec '17 4 of 7

Re GLE I think you are focusing only on the statement relating to the sub-division Gleeson Strategic Land, where the outcome is seen as flat - the outlook for the Homebuilding division is more rosy... as per the following:

Demand at Gleeson Homes remains strong with the forward order book at the end of November up more than 30% on last year....The Board expects Gleeson Homes to record an increase in completions for the first half year to 31 December 2017 of more than 15% compared with the prior half year total of 451 units; and for the year to 30 June 2018 of approximately 20% compared with the prior year total of 1,013 units.

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whitepjs 7th Dec '17 5 of 7
2

RM (LON:RM.) does look interesting, but there is the issue of its DB pension scheme. In 2015 the deficit was £41mn, and there is another triennial revaluation in May next year. Currently they are expected to contribute £3.6mn to the scheme per annum until 2024, which is a a decent amount of cash, but I suppose that could change in May. The dividend yield is appetising and decently covered, but again the FCF doesn't seem to support it. Presumably the uncertainty over the pension is the reason for the company's low rating? Stockopedia, though, thinks it's a 'Super Stock'. Either way, £2 seems like quite a ceiling to further advances.

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matylda 7th Dec '17 6 of 7
1

Re: RM (LON:RM.) - Yes, I noticed this in the last accounts "Pension deficit reduced to 22.2m(30 Nov 2016: 34.8m)" which worries me less.

Re: MJ Gleeson (LON:GLE) - Thanks, in my haste, my mistake!

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herbie47 7th Dec '17 7 of 7
2

RM (LON:RM.) the other thing noticed is the generous directors share options.

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