||EPS - Basic
||Market Cap (m)
|Oil Equipment Services & Distribution
Real-Time news about Amec (London Stock Exchange): 0 recent articles
|kenbarlowx: Any ideas on the rising short interest in AMEC? It took off in Jan and has (unlucky people) tracked the rising share price since.|
|haywards26: I am looking in on the sidelines here. Currently holding PFC and KENTZ with AMEC now on my radar following the price reductions and reverse of market sentiment following recent profit warnings. Looking for a price around 10.00 as my initial entry point. But not really gone into any indepth financial analysis as yet, but will do over the coming days.
Foster Wheeler acquisition appears very interesting, always share price turbulence with such large acquisition news.|
|john of groats: Euro Crisis Road Map
We are certainly not out of the woods yet. Judging by this list of key milestones, we will certainly experience market volatility for at least the next two months:
It is probably worth consulting this regularly to see how the share price may be affected by news, particularly of the raft of bond auctions.
|apad: Any views:
As posted on KENZ board:
FT on AMEC:
Samir Brikho has switched on the fog lights. On Tuesday, the chief executive of Amec, the UK oil services group, not only reported a 13 per cent jump in annual earnings per share; he also peered into the gloom to forecast that it would hit 100p by 2015, two-fifths higher than 2011's level. In addition, he announced a £400m share buy-back and a 15 per cent dividend increase sharing the spoils of Amec's growing order book and a backlog of £3.7bn. That is rare optimism and Mr Brikho probably expected investors to be impressed. Instead, Amec's share price over the day barely moved. But that was not too surprising. Amec's shares already trade at about 14 times 2012 earnings, close to the FTSE 350 oil equipment services index's multiple. Although the company boosted EPS 13 per cent last year, it will need to maintain this clip to hit its 2015 target. The company believes it can do this organically. But it has also flagged that acquisitions are on the horizon. Debt-free Amec certainly has the capacity to buy some rivals. The £400m buy-back will soak up four-fifths of its current cash balance. But it is a strong cash generator. Assuming that it keeps its net debt below twice its earnings before interest, tax, and amortisation (£300m last year), and any purchase yields ebita of 23 per cent of its equity value in line with Amec's a £900m-odd acquisition is possible.
So rumours it may try to buy UK rival Petrofac are likely to be false. Petrofac's market capitalisation is £5.3bn. That means any attempt would require a chunky equity call from Amec's shareholders something Tuesday's share buy-back appears to negate. Smaller rivals Hunting or Cape are possible targets, but could be more asset heavy than Amec would like. But with its shares trading at fair value, further upside looks dependent upon acquisitions.
If you want to go hunting for AMEC takeover targets, go looking amongst the specialist engineers that bring a significant technical advantage to AMEC, rather than its general competitors. AMEC has significant technical expertise in nuclear technology (e.g. safety codes) - it will be looking for adding technical value in preparation for the start of the Nuclear New Build program. The Hunting speculation in the FT article was spot on, in terms of technical fit, if it is for sale.
The interesting question is: "what's the short list?".
|phatprofit: Questor says BUY
The one phrase that spooked the markets in the announcement was that "the trading environment will remain challenging". This caused the shares to fall about 8pc at the open yesterday as the market took the view that the company was talking down this year's prospects.
However, it can hardly be a surprise that markets are challenging and there was actually much to be positive about the statement. The company has an order book of £3.2bn and it expects this to continue to grow. With revenues standing at £2.53bn in 2009, this represents about 15 months of work.
The company also said that it expected this order pipeline to continue to improve as the year progressed, so Amec must be well down the line in discussions for new contracts. However, these new orders are not likely to hit the top line in 2010, with the benefits seen from 2011 onwards. This is likely to be the source of the disappointment and prompted the share price fall.
The company did say that it had seen signs of a pick-up in the market in the first quarter. Significantly, Amec confirmed that it still expected to hit its margin target next year. The group is targeting an earnings before interest, tax and amortisation (EBITDA) margin of 8.5pc next year. In 2009, the group managed to increase this margin measure by an impressive 110 basis points to 8.2pc. It has also set a target of more than doubling earnings per share to at least 100p by 2015.
In the 12-month period to December 31, pre-tax profits came in at £203m compared with £306m in the previous year. The total dividend for the year was 17.7p, a 15pc year-on-year increase. The final payment of 11.6p will be made in May and the shares go ex-dividend for this payment on May 19. The shares are yielding 2.5pc.
When Questor spoke to Ian McHoul, Amec's chief financial officer, yesterday, he was bullish on long-term prospects for the group. He noted that there was lots of activity in the sector in which the group operates, with the opportunity to get in on a number of oil projects at the early exploration stages something that could lead to significant long-term projects for those where successful discoveries were made.
The group had a net cash position of £743m at the end of the year. This has led to some analysts saying that the balance sheet is inefficient and under-leveraged. Mr McHoul said that the company's main plan for the cash was to make strategic acquisitions at the right price, but he would consider returning it to shareholders via an earnings-enhancing buy-back in 12 months should no suitable purchases present themselves.
He believes that the expectations gap between the price at which business owners are prepared to sell and the price at which potential acquriers are prepared to buy is closing, so an increase in M&A activity across the market is likely.
The shares are trading on a December 2010 earnings multiple of 14.4 times, falling to 12.5 in 2011. However, if the cash is stripped out from the valuation, the group is trading on an ex-cash multiple of about 11 times, which looks cheap.
Questor believes that the long-term business case for Amec is intact and yesterday's falls have presented a buying opportunity. The shares were first recommended at 531½p on January 8 last year and the shares are up 44pc compared with a market up 23pc. Buy.|
|robert1983: have held (and traded) both AMEC and Lamp for a long time, 2 very good companies, combination could prove interesting although wonder how share price for each might react short/long term.|
|wendsworth: donemyhomework2: Like you have been monitoring and have to agree share price has been remarkably resilient despite market volatility and weakness in oil price.
AMEC has been my most successful share in the past having purchased initially at 364 and traded up to > 800p . Just waiting for the general market volatility to subside before committing.|
|wendsworth: Kamukak: I'm not currently a holder but have been and made substantial profits out of AMEC.
My view is you'll be able to buy these at a discount to current levels . Why? The general market will impact on AMEC' share price in the short term.
I expect top be buying back in sub 500p.|
|wendsworth: GGekkko: Charts can be a useful aid in a normal market trading scenario BUT not I venture to suggest in volatile markets .
At the risk of being boring....as I pen this comment the DOW is DOWN another 195 points. Some international market analysts are predicting that if the DOW falls through 12600 then the impact on global markets is likely to be severe.Should this prove to be the case then the AMEC share price as a FTSE stock will undoubtedly suffer a sharp decline .|
|wendsworth: LBO: There's always plenty of 'froth and bubble' in lead-ups to further bid activity. I would anticipate that potential bidders would be looking to snap-up stock .Interesting that the FT article did not speculate on price?
The AMEC share price is holding steady on a week when its gone ex-dividend and the general market has 'drifted'. This week-end's financial press could be interesting as we approach December ?|
Amec share price data is direct from the London Stock Exchange