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the share price wont recover until buyback is complete. in fact it will go down most days until then.
Meggitt likely to be demoted to FTSE 250 next week. Share price all at sea. RUDDerless?
A good question to which there is no single answer. The following may assist: http://www.investopedia.com/articles/02/041702.asp
why buy-back has caused share price down ? is it intending to save money to buy back ?
Hi MY21, BlackRock used CFD to add holding shares, Is it a good sign or not ? please add your comments if possible. Regards.
I rarely buy or sell. However I can't justify, on any valuation basis, the highs to which the sp has gone, so today I've sold my entire holding.
Meggitt remains on Questor’s radar but it’s not yet a buy: Meggitt’s shares suffered a 6% fall as the engineering group’s annual results failed to justify the 35% rise the stock has enjoyed since October. The full year numbers were in line with expectations – at constant currencies, revenue was flat at £1.6 billion and pretax profit was down 13% at £328.7 million – so the past four months have been a case of travelling in hope. That’s not to say the numbers were bad. Civil aerospace, which represents a whisker under half of the FTSE 100 group’s total sales, rose 6% when adjusted for currency changes. Military, at £539 million of total sales, was down 7%, while energy, with revenues of £163 million, was off by 3%. The lower oil price was one factor behind the decline in Meggitt’s energy business. Oil and gas producers are slashing capital expenditure across the board in the face of $50 oil. However, the company is confident that once the current panic ends and energy groups take a more reasoned look at areas in which to scale back, then Meggitt will be well positioned to benefit. Stephen Young, Chief Executive, sees hope in the 8% increase in defence spending pencilled in by Barack Obama’s in his President’s budget, but is realistic about what this figure will eventually be negotiated down to. “After years of budget cuts the prognosis is for flat spending, maybe slightly up,” he said. “The amount eventually agreed on [will probably be less] but some parts of the military will get more, such as the airforce.” Rather than new expensive projects, Mr Young sees Meggitt benefiting from the U.S. upgrading and refurbishing of equipment such as helicopters and land vehicles which have been worn out by long periods of service in Afghanistan. But it’s civilian aerospace where Meggitt shines. Mr Young pointed to the 63,000 aircraft using the company’s technology where it is the sole supplier - a position the business is unlikely to lose. Questor last looked at Meggitt in December when the shares where at 501p and rated the company as a hold but one to watch. Things are certainly getting better but at the current price-earnings ratio the shares still look a little too expensive to deserve an upgrade to buy - though that point is getting closer. Meggitt at 537p. Questor says “Hold”.
Programme now underway so,irrespective of the merits of share buy-back programmes and the associated impact on debt levels, so a willing buyer underpins the sp.
Low-flying aircraft: Meggitt says it operates under the radar, like a stealth aircraft. Certainly the aerospace engineering group’s plans for its first ever share buyback caught the market by surprise. Meggitt should benefit further in 2015 as the £200 million-£300 million buyback bolsters earnings per share to the tune of 6-9%. This is particularly handy as the outlook based on current trading has prompted downwards tweaks to some analysts’ forecasts. Meggitt insists that its expectation of organic revenue growth in the low to mid-single digits next year is not a downgrade as it has not explicitly guided on 2015 before. Whatever – it still doesn’t feel positive, especially in the long shadow cast by downgrades in August and last November. The share price looks somewhat higher than underlying trading justifies.
Now time to be buying again.
Maybe they were the 3m+ seller today.
Meggitt’s air shot: A friend, atomising clays with her shotgun, remarked: “hitting moving targets is easy when you have the knack”. That knack evades Lombard, who missed repeatedly, and Meggitt, whose half year underlying earnings undershot Bloomberg consensus by 13% at £151.4 million. Meggitt has therefore lowered its sights to target low single-digit sales growth this year. That still requires a rebound in the second half. Organic revenues, which exclude currency revenues, fell 3% at the interim stage. The shares dropped 7% as analysts cut forecasts. The feeling that Meggitt is drifting will be reinforced if these estimates are also shots in the dark. A market valuation of 14 times earnings partly reflects takeover rumours that tipped United Technologies of the U.S. as an acquirer. Consolidation is likely in the defence industry, though such boil-downs are rarely as inevitable as theorists imagine. Meggitt could at least boast of an order from the Indian navy for 160 Banshee target drones. They should give Indian gunners better aim than City forecasters, Lombard or Meggitt itself.
Time to take your profit & get out now.
OK, so who bought very nearly 3 million quids worth of shares late on today; out with it!
will see how markets react to Ukraine, Drop very likely, This particular drop is a fantastic time to buy, but if markets drop even more coz of crisis, then advantage should be taken of a more generous dip.
This looks ready for a 5% - 10% rise very soon.
Positive Points: Meggitt previously acquired Californian based Pacific Scientific (PacSci) for $685 million in 2011. Management highlighted that "the integration of Pacific Scientific Aerospace was fully completed with total synergies of $25 million having been achieved against an original target of $18 million. The Group reported that it continues to invest significantly in site consolidations, capacity expansion and new product development work following recent significant programme wins. Meggitt Production Systems in particular was seeing tangible improvements in quality and delivery. Meggitt acquired Piezotech for $42 million in the period. The group's financial position was reported as "strong" by management in the announcement.
Negative Points: Meggitt said it had identified a raw material supply issue relating to one product type dating back to 2012. A solution is in place however the cost of this issue is uncertain but the group is making a £20 million provision to account for the expected total financial exposure over the coming years. The civil aerospace industry has historically proved volatile. Major customers such as Boeing and Airbus are dependent on the highly competitive and cyclical airline industry. Currency movements provide potential to generate major headwinds. The outlook within military remains uncertain, reported the company, due to lack of clarity on US defence spending. Meggitt has relied on acquisitions to drive growth. This strategy carries with it the risks of overpaying for acquisitions or failing to integrate acquired companies which could impact on shareholder value.
Interim management statement: In today's announcement that spanned the third quarter to 31 October, the global engineer lowered its full-year revenue guidance after several setbacks including production problems in the United States hit third quarter trade, sending its shares down sharply by 9% in mid-morning trade. Specifically, this was due to short term production difficulties at Meggitt Sensing Systems and the timing of contract wins and project milestones in one of its energy businesses. Civil aftermarket revenues however continued their gradual recovery, up 2% year-on-year in the period although the outlook within military remains uncertain due to the lack of clarity over US defence spending. As a result of the above, and reflecting also the strengthening of sterling against the US dollar in the second half, the Group now expects a 2013 revenue growth rate in the low single digits.
Meggitt: JP Morgan reduces target price from 500p to 480p and maintains a neutral rating.
Meggitt: UBS downgrades from buy to neutral.
Meggit: UBS shifts target price from 440p to 450p and downgrades to neutral.
UBS cut its recommendation for aerospace engineer Meggitt from 'buy' to 'neutral', causing shares to fall on Monday morning. The broker has raised the target price for the shares from 440p to 450p, but removed the stock from its M&A watch list "on lack of value-creation grounds"
Meggitt: Societe Generale raises target price from 390p to 450p, while the hold recommendation is left unchanged.
With regard to any potential impact on Meggitt's share price, Morris added: "It is possible that Meggitt, as supplier of the B787 BCU, will be affected by some negative sentiment in the short-term." A 787 battery incident occurred on the ground in Boston on January 7th and a separate incident occurred in-flight in Japan on January 16th.