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Panmure Gordon has chosen Serco as a key pick for 2014, saying that it expects the outsourcing company to be given a "clean bill of health" following a tough year. It has raised its target price for the stock from 535p to 560p. "We think 2014E will be the earnings trough year, and there is scope for the company to rebuild its earnings and reputation during the course of the year. With 18% upside and a dividend yield of 3% on offer, we maintain a 'buy' recommendation on the shares and believe recent strength has been justified," said Analyst Mike Allen. Analysts at Barclays Capital have highlighted potential improving flows for UK asset managers, saying that stocks will benefit from a bullish outlook for 2014. The bank said that inflow rates are still "sub-trend" and have the potential to improve further. Meanwhile, the average price-to-earnings valuation multiple for asset managers remains at around 14-14.5, which "appear[s] mid-range with the potential to re-rate higher".
Serco Group plc (Serco), the international service company, today announces that it has expanded its contract with the UK's Ministry of Justice (MoJ) to build and operate an extension to HMP Thameside. The expansion has a total value to Serco of £120m over 22 years, including £36m for the 18-month construction phase which has now commenced
Serco Group plc (Serco), the international service company, has been notified today by the Ministry of Justice (MoJ) and Cabinet Office that the audits and reviews of Serco's contracts have concluded satisfactorily. The Cabinet Office has today also described Serco's corporate renewal programme as well advanced!!!
when you say take a hammering - do you call Serco shares up 7% taking a hammering? The enquiry must have pretty much cleared Serco's, after agreeing to pay back the innaccuracies in the contracts. Back to business for Serco effectively winning contracts again. Onwards and upwards.
Shady security privateers Serco and G4S took a hammering yesterday after a review into their combined £5.9 billion worth of government contracts unearthed shocking behaviour by the two firms. Serco has agreed to repay the government £68.5 million for overcharging on tagging contracts - including for offenders who were back in prison, overseas or dead. G4S has not agreed to give any money back, but discussions continue. Meanwhile G4S has been referred to the Serious Fraud Office (SFO) for a second time after investigators found "serious" issues with invoicing, delivery and performance reporting in two of its court services contracts. And police have been asked to investigate Serco staff caught recording prisoners as having been delivered ready for court when they were not. Both companies have also been forced to back away from bidding for probation service contracts - but ministers have muddied the waters by saying they can support smaller firms. The measures follow a SFO investigation involving both companies was initiated after it was revealed they had overcharged the government for tagging offenders, some of whom were found to be dead, back in prison or overseas. Cabinet Office Minister Francis Maude claimed Serco's agreement to give back £68.5m was "good news for taxpayers."
... get to 550 in what currency? Indian Rupees?!
Holdings RNS!! Investco Ltd have gone above 14%! That big big must have been them!
Wow have just seen that delayed trade of £5.7 million!!!
so I did. Now it's time to hold till it gets to 550!
We saw the bottom at 4.15, now onwards and upward back to £5. Well done to the guys who bought yesterday!
I agree, Its too big a company to go bust. Just imagine how man people will go on the doll. the government will surely back this company.
Never traded this but i was looking to get in 3 days ago at £5 thinking that was a bargain! Then i saw this today at 4.25 and thought wow why the drop? Read up and its just a minor profit warning for 2013 and 2014. By the time i read that it went back up to 4.33 so i went out to get some food then saw it at 4.15!!! Then i bought 10k...this is a HUGE over-reaction and is a complete BARGAIN at this price!! Onwards and upwards from now so top-up!!
Your right, just a nice discount IMO. Not sure if it will hit £4.00, although if it does I'll too up. It touched 4.18-19 and did a 5-6p jump, think it might be stabilising at £4.26 ready for slow recovery from there. We shall see :)
The earnings target is still very similar to last year so no real harm, just a 30% discount on the share price!
No way will this go bust too many vested interests in the Goverment. Probably see it go down to £4.00 in the next few days which is a better traget price stay clear or invest only tiny amount until them or you will have a long wait for a return. Good luck TPKart
Bounce time soon? Today theres been a broker recommendation to BUY with a target of £645! I've just bought in, has anyone else?
Well, now the heads been chopped off may be the shareprice will recover!
The investigation hanging over this group seems to be hitting the share price hard. If the investigation goes against Serco the future is black. Any other views out there.
Does this fall when it gets relegated to the 250?
Shouldn't this have fallen today as it trades exdiv?
Positive Points: Group organic or like-for-like revenue growth of 8.8% was reported, reflecting the benefits of global portfolio breadth according to management. The company's AMEAA (Australasia, Middle East, Asia and Africa) business reported revenue growth of 19%, with significant volume-related growth in immigration services. Management noted that "the overall outlook remains positive." For 2013, an improvement in the rate of organic revenue growth is expected for the year as a whole. With regards to PECS, Serco noted that it "found no evidence that this misreporting was undertaken with the knowledge or approval of management outside the contract." Investment in contract bidding and new market development activity has increased. The company's Global Services business reported growth of 18%, supported by the particularly strong level of contract awards during 2012. A dividend policy to increase the total dividend each year broadly in line with the increase in its underlying earnings, was previously outlined. The half year dividend per share was increased by 17% to 3.1 pence. Serco's international portfolio provides resilience and growth.
Negative Points: An investigation has been launched into the misreporting of data in relation to its Prisoner Escort and Custody Services (PECS) contract to the City of London Police. Serco has agreed with the Ministry of Justice a three-month programme to restore performance on the PECS contract. If at the end of this period, Serco meets the performance requirements of the contract the contract will be retained by Serco. The costs of this improvement programme will be borne by Serco and any profit earned since the contract was renewed in 2011, estimated to be around £2 million, will be repaid. Serco will also forgo any future profits on the contract. The PECS contract was awarded in March 2011 and valued at approximately £285 million over 7 years. The UK government previously announced an investigation into the charging of services provided by both Serco Group and G4S. Uncertainty with regards to the findings of the investigation and its possible impact going forward currently persists. On the back of two recently announced investigations, the company's reputation and ability to win new contracts has arguably been dented. The company's adjusted operating margin from ongoing activities reduced by 0.23% to 5.7%, reflecting investment in contract bidding and new market development activity. Group order book of £18.5 billion as at 30 June 2013 (£19.1 billion at 31 December 2012). The company's Americas business reported a 3% decline in revenues reflecting a challenging US federal contracting market. The group's US federal market remains challenging. Serco makes around a fifth of its sales in the US, primarily from federal government. Rather than outsourcing work such as defence, some arenas may simply be axed altogether by governments. Serco operates in a highly competitive market. The company is exposed to political risk given that a vast majority of its revenues are exposed to the public sector.
Financial Highlights: Adjusted revenue (ongoing activities) rose by 11.8% to £2.55 billion. Group organic revenue growth of 8.8% Adjusted operating profit (ongoing activities) increased by 7.5% Adjusted operating margin from ongoing activities reduced by 0.23% Dividend per share increased by 17% to 3.1 pence
Half year results: The group's results proved to be overshadowed by an additional announcement from Serco in relation to the misreporting of data in relation to its Prisoner Escort and Custody Services (PECS) contract to the City of London Police. The group's share price fell by over 12% in mid morning trading. Under the contract Serco is required to deliver defendants to Court, and its performance is measured against the delivery of a defendant being 'Designated Ready and Available for Court Time' (DRACT). Serco management has identified misreporting of DRACT data. Serco has agreed with the Ministry of Justice a three-month programme to restore performance on the PECS contract. As for the results themselves, the figures proved to be broadly in line with expectations. The CEO noted that "the strong financial performance over the first six months of 2013 has met expectations. Overall guidance for the full year is unchanged and the outlook remains positive." In all, and weighing ongoing desire from governments and companies to cut costs and management's current positive outlook comments against uncertainty in relation to now two investigations at the company
serco have lots of contracts and but for a few hiccups do well for there share holders .