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I did not sell my holding of course. Merely replying to Ronaldo. I think that anything to do with property is suffering at present, but if it looks like Boris will win, then property will be the first to surge, so I'm hanging in their. I certainly don't think there is much downside from here, unless Commie Corbyn is elected.
Trading statement due 27 of this month.
Should put a bit of fizz into the pop I hope.
WE all know that this share price represents superb value at the moment. I have held on this knowledge. I am sure that once Brexit is out of the way, one way or the other, the cloud of uncertainty will lift, companies will increase their investment and the SP will rise. It's only about mood music. Nothing has changed about the company and profits have increased.
Good call Rivaldo
I bought a few today. Just a nibble - looks like some support here.
I've reluctantly sold, concluding today. The commercial construction data yesterday was absolutely awful:
CTO is a very, very well-run, high quality company. But in the current climate, even if CTO manages to maintain its order book, I can only see investor sentiment towards the sector and the company worsening, despite the (currently) very low P/E. In which case there's limited if any upside, whereas the downside could yet again be back to 80p-85p or so.
It's also nice to have more cash in the bank in reserve given all the market shenanigans at present!
Good luck all. I may well be wrong/back soon!
Appears it is Nandlal and Deep Valecha connected to Regent Oil. They appear in the Sunday Times Rich list in position 934 with a worth of £126m.
Maybe it's me, however it appears to be an unusual type of major shareholder.
See Regent Oil & Gas Co. increasing its holding for second time this week to over 11%.
I can't get over those sub-3% margins, no matter how cheap it looks.
"The point being that investors’ misperception over TClarke’s trading prospects has created an investment opportunity for investors to exploit. That’s because there is actually a high probability that TClarke will generate cumulative EPS of 36p over the 2019 and 2020 financial years, in-line with analyst estimates. That sum equates to a third of the share price. Also, as seasonal working capital build eases in the second half then TClarke’s half year cash pile of £4.7m should double to about £10m by the year-end, a sum worth 23p a share. In other words, the shares are effectively being priced on a cash-adjusted current year price/earnings (PE) ratio of 4.7. There is a progressive dividend, t00. The board lifted the interim payout per share by 14 per cent to 0.75p, and N+1 Singer predicts a 10 per cent hike to 4.4p for the full-year, implying the shares offer a prospective dividend yield of 4.3 per cent.
True, the shares have pulled back since I last advised buying, at 128p, in mid-May (‘TClarke reports a robust start to 2019 financial year’, 16 May 2019), albeit they are still well ahead of my 90p entry point last December and the company has since paid out its 2018 final dividend of 3.34p (‘Profit from a buoyant earnings cycle’, 7 December 2018). However, I strongly feel this is a buying opportunity given that the current miserly rating is completely at odds with the trading prospects of the company and the strong likelihood that the directors will hit their 2019 and 2020 internal budgets. Indeed, during our results call, Mr Mitchell told me that the business “is trading ahead of internal budgets for turnover”. That’s well worth noting as is the ability of TClarke to convert what is undoubtedly a bumper pipeline of work into firm orders.
Offering 43 per cent upside to my maintained 150p target price, I feel that the shares are well worth buying."
Great article by Simon Thompson. If CTO had been able to include these snippets in the results narrative then sentiment may have been entirely different:
"TClarke already has tenders out on two major European projects (contract values of £30m to £40m) which if successful will start in March 2020. The company also has an impressive bid pipeline across the whole of the UK.
In fact, Mr Mitchell says the business has £1bn of tenders out with clients"
Here's the full tip:
"I had an incredibly informative results call with the directors of nationwide building services contractor T Clarke (CTO:105p). The company ended the half year with a bumper £370m order book, having won around £130m worth of tenders since the end of 2018 and delivered 12 per cent higher revenues of £171m in the six month trading period. It’s increasingly profitable work, as highlighted by the uptick in operating margin from 2.6 per cent to 2.9 per cent, which helped drive the 24 per cent increase in first half underlying pre-tax profit and earnings per share (EPS) to £4.6m and 8.67p, respectively.
Finance director Trevor Mitchell confirmed to me that 96 per cent of house broker N+1 Singer’s full-year revenue estimate of £340m is covered by the contracted order book, and half of the broker’s 2020 revenue forecast of £360m, too. Both Mr Mitchell and chief executive Mark Lawrence reiterated their confidence in hitting the broker’s numbers which point to full-year adjusted pre-tax profit and EPS rising by 16 per cent to £9.3m and 17.5p in 2019, respectively. They are also confident of achieving N+1 Singer’s 2020 pre-tax profit and EPS estimates of £9.9m and 18.6p.
But TClarke’s share price fell by 12 per cent post the results as investors focused on news that some of the company’s London clients were holding back starting their new developments given UK political uncertainty. Also, some less well funded rivals in the London market are desperate for work which has created pricing pressure. TClarke clearly isn’t and the board were well ahead of the game to mitigate any impact in London as they have already expanded into Europe to take advantage of high margin data centre work. This has led to some significant opportunities: TClarke already has tenders out on two major European projects (contract values of £30m to £40m) which if successful will start in March 2020. The company also has an impressive bid pipeline across the whole of the UK.
In fact, Mr Mitchell says the business has £1bn of tenders out with clients including work at Manchester Airport, and the new Channel4 studios in Leeds (TClarke won the tender on the London studio, so looks well placed). Moreover, the corporate presentation accompanying the interims results is absolutely jammed pack full of tenders which, based on an historic win rate of between one-in-three to one-in-four, indicates a sizeable opportunity for the company to exploit.
Looks like the shares are now slowly recovering from the lows this morning
But it will take a lot more than what is going on now to reach the opening price, ( or yesterday's closing price ) but tomorrow is another day.
Upbeat report by Simon T. reinforces the view that today’s sp decline is simply misplaced sentiment.
Correction to my last post, in line with expectation not ahead***
I disagree and think there is good value at this price. IMO the SP was oversold this morning given H1 was positive and trading performance remains profitable and ahead of expectations. I’ve brought in and looking for this to be back around 115 next week.
Tanked because of projects delayed by Brexit, despite CTO putting into place accelerator plans for projects to restart swiftly when political uncertainty lifted - as if it ever will. Further to fall IMO
Can anyone enlighten me as to why share price crashes when company reports thst everything is going well?
A very good set of results, or in another way what was expected from CTO, maintaining their prediction of a 3% margins on the way, today was already very close 2.9% (2.6%).
Some precaution on the Brexit outlook has got some selling at the start, a good opportunity for others to pick the loose shares, on a PE of less than 6 on the forecast of 17.50p for the year
N+1 Singer retain their 150p target and forecasts of 17.5p EPS this year, rising to 18.6p EPS next year.
They see dividends of 4.4p rising to 4.8p.
"H1 was another positive trading period for TClarke, with PBT increasing by 24% to
£4.6m. The Group continues to make solid progress against its 3.0% operating margin
target, achieving a margin of 2.9% in H1 (H1’18: 2.6%). The order book has been
maintained at £370m and provides strong support for our full year forecast, which is now 96% covered. Our FY20 forecast is also 50% covered by the order book. This is a strong position against a backdrop of political uncertainty and we maintain our forecasts.
The strategy is delivering and TClarke is well on its way to achieving its full year targets. With sustained earnings momentum, we believe the shares will continue to outperform the wider peer group and we reiterate our 150p intrinsic value."
Very good numbers, with 8.7p EPS in H1 alone and confirmation of expectations of 17.5p EPS for the year.
Plus £3.6m net cash at the seasonal low point, a continued £370m order book - and £182m of revenues already secured for next year.
The Brexit caveat is to be expected, and surely already more than baked into the share price on a paltry current year P/E of 6.5!
Some share price movement first 116p "AT" and now 117p "AT"
But a large spread 117 v 121p and better middle price than yesterday ( 116 v 119p )
3 days away for the results 1 August
Time to think ahead and if the movement up and down from 117 to 120.50p for the last 3 weeks is going to break after the expected good Interims.
1 month chart candlestick
Good news, and in a fast-growing sector:
"Healthcare wins two more hospital imaging projects and expands into vet market
1/7/19 : TClarke has won hospital imaging projects for new Cath Labs at Heartlands Hospital, Birmingham and a new MRI facility at St Helier Hospital, Carshalton. This follows on a string of recent completions including a new Cath Lab UPS installation at HCA London Bridge Hospital, a Fluoro Room UPS installation for London Hammersmith Hospital, a new Cath Lab installation at NHS Royal Blackburn Hospital and twin Cath Lab and Infrastructure Modifications for NHS Wythenshawe Hospital, Manchester. Nigel Thompson reports on the ongoing success of our healthcare operation which he leads.
Growing demand as equipment lifecycles shorten and need increases
The demand in diagnostic imaging increases year on year across the Health sector and whereas the average lifespan of imaging equipment used to be seven to ten years, it is now around five years due to technology advances and competition between global equipment suppliers.
TClarke is a market leader in medical controls panels manufacture and in turnkey installation of medical imaging suites
We have deep partnership relationships with major global imaging companies – Our Controls Panel operation (where we manufacture medical imaging control panels at our manufacturing operation in Stansted) has now expanded beyond GE and Siemens, with a new 3 year deal being agreed with Philips Healthcare.
We are also currently in negotiations with another Medical Imaging supplier for the same. These partnerships keep us at the cutting edge of the technology as it develops and they have also helped us establish ourselves as a leader in imaging equipment installations.
Steady and sustained growth opportunities
As ever with TClarke, we are disciplined and selective in seeking low risk projects, where we can deliver the returns our business strategy targets – so our growth opportunity here is steady and sustained.
And there is a steady trend to report. On TClarke ‘turnkey’ installation projects (where we deliver the whole construction installation of imaging suites), end clients are placing a premium on the quality and professionalism which our teams offer – and equipment manufacturers are noticing this, project by project.
The healthcare market is large, with inevitable long term growth prospects, as the population ages and as medical imaging offers more and more for patients. In the last six months, we have also ventured in the Veterinarian Market, carrying out works for IVC, the UK’s largest independent Vet care organisation, providing support for CT and MRI Diagnostic imaging equipment.
Great news. And it's already bearing fruit given the last paragraph:
"we’ve already won our first two with North Tyneside Council"
" Newcastle wins four out of four electrical frameworks
25/6/19 : TClarke’s Newcastle team have won places on four out of four key regional frameworks. as Operations Director Jim Stewart explains:
Having recently made our submissions to win places on four key regional frameworks, we have been delighted to hear back that in each case we’ve been successful. The frameworks involved are:
NEUPC –the North Eastern University Purchasing Consortium, which is in place to cover local Universities such as Newcastle, Durham and Teesside.
Sunderland City Council – Power and multiple electrical technologies framework.
Stockton Borough Council – Stockton and Tees Borough electrical framework. (our submission ranked in first place)
North Tyneside Council – electrical planned investment works or operational, schools and commercial building framework. (our submission ranked in first place)
CTO announce the H1 results will be out on 1st August - a week earlier than prior years, and an incredibly quick turnaround from the 30/6 results date.
Extremely impressive. Plus no note that trading is in any way changed from the "positive" trading outlined at the AGM: