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Plenty of upside here... five assessments within the last seven weeks by brokers - and none with a target price below £2.40.
Looking good here again. Should push past into the mid 200’s.
Any guess for how low it goes. My guess 169 at worst before bounce.
HS2 rail leg to Leeds being scrapped? GFRD plays part in HS2?
Maybe something of an extreme reaction to these going ex-divi ?
boredom.....
What's caused the recent decline from over 200p here?
Stockopedia says:
" Earnings Yield compares a company's profit with its market valuation (worked out by dividing its operating profit by its enterprise value). It gives you a total value of the stock (including its cash and debt), which makes it easier to compare different stocks. As a percentage, the higher the Earnings Yield, the better value the share.
A rule of thumb for a reasonable Earnings Yield might be 5%, and the Earnings Yield for Galliford Try Holdings is currently 49.7%."
At last the market seems to be appreciating Galliford. The latest acquisition should help but still undervalued (IMHO) without that. Now 195p (this time last year 76p)
Market begining to realise that the recent acquisition is very good news -now over 190p -
I personally believe this is a shrewd bit of business by GFRD. Water is the new place to be and with nmcn's already established business it makes sense. Now all we need is to turn the previous turnover in to profit. Easier said than done I know but if GFRD can put the right management in to this area of the business then this will add to our already strong business model. I work within the water industry and know the level of spend that will be coming through over the next few years. A good move all round and I hope that in the months and years to come we will all see the benefits of this aquisition. Good fortune to all Galliford investors and those that are considering dipping their toes in to this !!!! Apologies for the attempted pun :-)
Thanks Muktass. Did the news report give P&L details for each of the nmcn divisions or just the group as a whole? I'd be interested to know what the 2020 performance was for the water division that GFRD acquired.
According to construction news, nmcn was due to report losses of £43m for 2020 but GFRD expects the acquisition to be immediately earnings enhancing. Only time will tell I think.
According to the RNS:
'In addition to the £1m purchase price, Galliford Try anticipates that it will have to fund certain contractual liabilities incurred prior to the completion date of the transaction which will be necessary to provide operational stability'
They must have an idea as to these costs, so why not share this info with investors?
The RNS states that in 2019 nmcn's water division made a profit of £7.6m on sales of £282.6m, without referring to the fact that the 2020 order book was well down on this. They are taking on all 900 employees, so I wonder if the business is profitable at the current level of sales.
Hands up who saw that coming? Costing £1m and inheriting some 900 workforce. Wonder how many employees GT have at the moment? Wonder what debts we are inheriting? Hope all that cash wasn't putting pressure on the directors to make better use of it. Time will tell.
Really pleased with these results. Unexciting, unspectacular whilst solid. My view is that is not a x5 burner that the spivs love, but a solid bedrock within one's portfolio, for the holding, which will grow in both share price appreciation and dividend slowly, surely but CRUCIALLY consistently. This is not a high margin business, but with contract constraint will grow profits on the back of reputation for delivery and stability, which amongst the littered gutter of failed construction/infrastructure companies is crucial. Many, including myself, question the cash balance greater than market value, and seemingly growing, but such reserves/financial strength actually helps position them to procure contracts. The question for me is, at what point, do those cash balances, for a business showing contract bidding constraint, and an excellent forward looking order book translate in an increased dividend/special dividend return of cash, or a private equity takeover on the basis of winding down/completing contracts and pocketing the difference. One of those 2 will happen, as there has to be an inflection point if that cash balance maibntains/increases.
good results and better outlook - well done Bill and team.
V O X Markets interview this morning - Andrew Duxbury of Galliford Try discusses their strong financial performance and sustainable growth strategy
Happy with those results.
Nice one.
Final dividend payment of 3.5p, together with an interim dividend of 1.2p giving a total dividend of 4.7p covered by 2.0x earnings from continuing operations. Policy to increase dividend in line with earnings, with dividend cover expected to be in the range of 2.0 - 2.5 times earnings going forward.
Perhaps waiting to see the dividend announcement tomorrow. The sector is littered with contracts that have gone wrong and Galliford have had their share but hopefully have learnt from their experience. If I have understood correctly there is a claim at arbitration that if settled in Galliford's favour would boost profit/cash. I am not clear what it would do if it went the other way.
From half year report:
"As previously disclosed, the Group provided services in respect of three contracts with entities owned by a major infrastructure fund of a blue-chip listed company. Our work on these contracts formally ceased on their termination in August 2018. Costs were significantly impacted by client-driven scope changes and the Group has submitted claims and variations to the value of circa £95m in respect of these costs (June 2020: £95m). The Group has received extensive advice on our entitlement, and we have been successful in two adjudications supporting the validity of the Group's position. Taking into account the requirements of IFRS 15, the Group had constrained the revenue recognised in prior periods to the extent that it was highly probable not to result in a significant reversal in the future. At 31 December 2020 the Group has updated its assessed recoverability in accordance with IFRS 15 and expected credit loss provision in accordance with IFRS 9, both of which assessments are unchanged in the period."
Hi, new to the forum. Can anyone explain why the market cap is lower than the cash this company holds. I can see its margins are razor thin but surely this is too cheap?