Northbridge Industrial S... Share Discussion Threads

[smithie6] 25/8/2014 12:00

Topvest

thought this might interest you

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from Feb 2013
iii msg brd.

"The share price of Northbridge has rocketed by around 40% since November and the trajectory has become almost vertical over the past couple of weeks. Yet as far as I am aware ..."

natural to want to sell after a large fast price rise....but not always the right thing to do....sometimes there is more to come later

[smithie6] 24/8/2014 18:45

oh....and as per what someone else posted recently...
around time for another acquisition !

to keep growing...and avoid upsetting shareholders and instituts !!....the MD has no choice but to keep investing the cash being generated (around 11M per year) in more rental equipment or acquisitions

and 2013 accounts say that gearing reduced in 2012 from 44 to 31%

and by end of 2014 it will have crashed to a very low % unless they spend the cash being generated !

(they obviously wont use all the cash to just pay down debt....since suddenly the EPS growth would stop....and the MD would find himself down at the job centre !....
of course wouldnt happen....he has been the one pushing the growth since listing in 2006...and doing a 10/10 job.....)

forthcoming results should reveal what they have been doing with the cash obtained in H1....who knows maybe acquisition news...or during H2

[smithie6] 23/8/2014 13:08

...been analysing some numbers from NBI over past years....

...growth of turnover per share

...some moves NBI made in 2013 that should help the EPS in 2014

...estimates of EPS for 2014, 2015 and 2016

...estimates of tangible nett assets at end of 2014, 2015 and 2016

...and estimated share price for P/E of 15 and 20 in 2016.

and opinions and notes

too long to post here...take up 2 or 3 pages

hxxp://fulltimeinvestors.com/Northbridge/

[smithie6] 22/8/2014 16:57

H1 results 25th Sept

Mkt expects them to be solid/good based on the run up in the sp


"which will be announced on 25 September 2014.

As indicated on 29 May at the time of our AGM, Northbridge has achieved a good start to 2014 in both its sales and rental activities. The ongoing investment in our global hire fleet has resulted in good rental revenue and strong cash flow "

strong cash flow.....imo...strong profit generation...

"We expect results for 2014 as a whole to be in line with management's expectations. "
based on H1 results.....

imo a confident RNS......expecting results for the year to meet expectations....

well.....if they do....then start thinking about next year EPS....which I guess the mkt has been doing over last few weeks...with the share price run up...
(despite the share price run up....my guess is that it is not the moment to get off....the % odds on a sudden change in fortunes...looks relatively small imo...
noting that a lot of the co. work is via contracts....for a certain period....its not 1 day hires where next months turnover is unknown...
while of course nothing is gteed in shares
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on 25th Sept they will hopefully update on trading...
3/4 of the year will then have passed...start thinking about next years EPS
if doing well then maybe 35-40p EPS next year and current 600p is then perhaps about right...or cheapish if go from 28p to close to 40p over 2 years...people like growth....
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if take 2 or 3 yrs to get to 40p EPS...or 4 ...worth holding on....imo they will get there...and then keep going...if the last X years is any guide
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Update
Woody if you are reading...

note that 1.6 pnd of nett tang. assets per share (based on 2013 accounts).... u should include in any calcs.

and that nett book value of hire fleet went up 30% last year...to 28M
(update. perhaps/prob. error....but fleet value can be defined in various ways, cost, depreciated etc etc)
(rental is the more profitable part of NBI business...if rental income were to grow 30% then good for profits...although depends how much of that hire fleet increase is already input to the 2013 results...)
and Middle East double its turnover last yr. !...tax free there (taxable at Group level ??) and oil services added to Middle East for first time in 2013...and Middle East is an oil/gas area...so there is a chance of business from that new service there
..so imo the NBI results perf. of 2013 over 2012 could (does imo) have more to run

[smithie6] 22/8/2014 16:20

Woody
AMS
strange old world....how many UK cos. are there involved in killing medical bugs or treatment of wounds.....seems like loads !! and I dont know the sector...
..at least AMS chart seems to have a long term up trend so far....like NBI has...
(medical....over my head)

[smithie6] 22/8/2014 16:01

(Woody
CHRT
imo ...naw.....acquisition is small wrt cap. value of CHRT so difficult for it to make much difference imo to the numbers....and clear that T/O of the acquisition is up and down....typical for supplying defence sector.....
(defence/Govt. paid sector....been there...done that ! )

MD of BAE Systems sold a shed load of shares recently....enough to keep me away from the sector personally...and the BAE long term share chart
and with austerity in many countries....defence budgets could be under pressure for years to come....although UK perhaps better than others...

[smithie6] 22/8/2014 15:50

Hi Woody
"I'm still largely in cash after selling off between jan and march this year."
...interesting...

good luck

I had some goes at shorting over the same period..since I also thought the mkt looked frothy...but got my timing wrong.....very difficult thing that shorting lark......although most of my shorts are now in the money...if I was still holding..

Im currently fully invested ....but being careful to pick things with support from earnings, or assets or both etc in case there is a mkt fall...

interesting time for mkts with numerous worries around ...like the Ukraine and interest rate etc.....but I guess there are always worries...

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Creston
fairly well analysed/known...
low value score btw for quality on - ratings system....which is as per investors views...(which is why its P/E is low...could well go up.....but might bore us to death doing it !...like last 10 yrs !)

[smithie6] 22/8/2014 15:40

Anyone rushing to buy WESP for its stake in NBI (dream on !)...might want to read my calcs. just posted on WSE msg. brd for NAV for Western...and value in NBI shares for each Western share....(in fact 62p to buy 1 Western share...and you get 62p worth of NAV in NBI shares for that...+ other assets)

[woodcutter] 22/8/2014 15:00

Smithie

You may be right on comparing with a small filter group like ashtead but i chose the index which i figure is reasonably representative. Interestingly AHT is in the support services sector so i most likely wouldn't use that comparator and although the businesses have some similarities they're quite different too.

What drove me to sell more than anything else was the TA. I've seen this pattern many times and although it doesn't always pan out it is pretty strong and is realised more often than not.

CRE, i was in this a while ago and sold for a small loss. I was warned by a few fellow investors on these boards regarding Elgie and the way the business was run, his personal fiefdom! Excessive emoluments!

I think he's left now but i won't be revisiting. The recent share price spike still has a lot of resistance to overcome and from a pure TA prespective it would need to break 116p significantly before i'd consider a purchase. It's currently in a consolidation range bound phase, as are many stocks

I've looked at SWL in the past and from recollection concluded that their margins were too thin and mainly supplying supermarkets etc i didn't think they'd any pricing power. I'll have another look.

I'm still largely in cash after selling off between jan and march this year. Several weeks ago i bought quite a few XXP and AMS. I've posted on the threads if you're interested. I've kept all the XPP but sold half the AMS on the recent rise. I also bought OPAY on the dip but sold that too a few weeks ago, probably a bit early

And I've recently had a very little nibble a CHRT based on the MCL acquisition. I expect this to be a real growth area for them so i'll pyramid up if the share price rises.

I've posted on several threads that i'm trading in and out more at the present i don't see any long term trending on any stocks even on good news, (NBI GEM, and GEMD excepted) most of those i look at spike up and return to previous support, or there abouts, so i figure the only way to make a buck is to move in and out.

Woody

post note: I've also been buying CBG and LRE on lows and watching for a 1300p breakout now on CBG. Woodfords been buying LRE heavily too.

[smithie6] 22/8/2014 14:22

btw
anyone seen any broker EPS estimates for NBI for this fin. year and for next year ?

was it 33-35p area for this year and around 40p for next fin. year ...or ?
(how good any estimates ever are is another question perhaps...although for NBI I think the co. gives them a rough steer)

[smithie6] 22/8/2014 14:21

Hey Woody
If you decided to re-invest your sales cash into another Western holding...such as CRE or SWL..or WESP itself ! (and increase their sp) ...youd probably make me and Topvest happy !

[smithie6] 22/8/2014 13:38

as a postscript to my long post...

in any case....doesnt matter much what the share price does now...(although it is great to see it going up !)

its still a small co. trying hard to grow....and will continue to do that...
large changes in fleet size over last few yrs...and various acquisitions made
and mkt now has confidence in the bod

in 3 to 5 yrs I hope that the co. will be bigger...and hence more profitable..(as feeds profits back in to the business as it has in the past)..and then again 3 to 5 yrs after that !
along the way the share price will up and down...hopefully with an underlying uptrend if the perf. since listing is any indication.....
(look at what Next share price has done over 20 yrs...is it x100)

anyone that bt. much lower down selling some, or all, now after making large % profits....logical...and up by 1/3rd just since May !

[alter ego] 22/8/2014 13:26

I remain a holder here, since 2010, and see an acquisition giving access to N America as the next big opportunity. When? Who knows, but IMO it surely is being sought.

[smithie6] 22/8/2014 13:11

interesting....1 seller and 1 top slicer

I havent read the 2 magazine views....but I think there is a chance of an above expectations RNS in H2 or some other +ve news.
Chairman bt. 50k worth at 5 quid...and an institut that has around 10% already...

and magazine coverage recently....one assumes they have some sources for info...such as the co.....sometimes mag. journos can be right !

these hire companies....they are able to do well if their kit is highly occupied (and badly if it is not !)
look at the Ashstead results btw..which were astounding...although different business model I think
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Woodcutter
do you think that ind. engineering sector index is relevant ?
should it not be a hire sector index ?

If you compare NBI share price with Ashsteads...then NBI has underperformed ! and has more to go !

AHT
underlying annual PBT up 50% !!!...for revenue up 24% to 1.4Bn pnds...
(hire cos. are operationally geared)


NBI could surprise us...who knows...
but I do recall some analyst predictions that showed EPS growth rate increasing around 2014/2015....fleet size has grown a high % over last 2 yrs....worth noting...


Hire sector has been doing well I think....much better than the ind. eng. index. you pulled up.

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imo a lot of the share price rise from 250p to here is because the 250p price was...wrong !
the P/E was less than then
and the mkt has slowly been giving a higher value to NBI EPS and to its potential....as the potential for NBI acquisitions to knit together takes shape....takes time...
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one key factor imo for NBI results is how the Middle East parts perform....
NBI had a fair amount of assets there which over the past years had not performed.....if it does then that could easily be a solid addition to the EPS....

worth being aware of imo

and there was some news ref. that area I recall.

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Woodcutter
....be interesting to see if you get a chance to get back in at a lower price. I would say that the odds are perhaps against you...time will tell...NBI produces a high amount of cash before the depreciation charge....and they make a high nett margin...the EPS has a high chance to keep growing...how the mkt values the perf. is another qu. of course...imo the share price may well go up and down...but odds are in favour of it being good bit higher in 5 yrs time...unless they run in to competition and pricing pressure...and the oil/gas sector is probably quite difficult for any new entrants so hopefully some protection from that.....

[topvest] 22/8/2014 11:35

I've top sliced a few at £6 which was my target. Happy to remain a holder here and indirectly in WSE though.

[woodcutter] 22/8/2014 10:09

sold my last tranche this morning. It's been a great run over the last few years and a good investment having nearly tripled my original stake. But all good things, at some point, come to an end.

The recent rise on the basis of tips in journals looks to have spiked the share price and the FA valuation looks a little stretched now historically imo and the TA was compelling so i've taken my profits. The market is very choppy at present so a bird in the hand as they say.

I really like the business and the management have proven to be both sound and honest in their manangement of the business so i'll watch closely for a future re-entry point.

The share price is way outside the upper bollinger band (not shown) and there's a possible candle reversal pattern developing and possible RSI/MACD price divergence too, (MACD divergence is more important as the share price is in an uptrend) suggests the share price is stretched. It's also moving strongly against the sector trend.



woody

[smithie6] 22/8/2014 08:49

BTW
as I have mentioned before about WESP

For 100p you can buy 100p worth of NBI shares.

Or if buy WESP for 100p you get 100p of NBI shares (+ a small bit more) AND 90-100p of other stuff (Creston. Swallowfield. + part of a blue chips fund)

annual total divi is currently around 2p I think....there is a final and an interim

(WESP does have some -ve factors like
- on ISDX
- very illiquid
- illiquidity can/will affect the price for trades
- to avoid the full spread.....imo just use limit orders. If the MM has trades to do he will do them at lower spread rather than not do them and make 0.
- controlled by 1 family (Marshalls....generation after generation...yes really..)
- running cost is higher than I would like (300k/yr).....but immaterial since 2009 as the NAV rise wipes that out

since 2009 the share price has been doing well
and the high value in NBI is very real

WESP was one of the founding investors in NBI (had around 20% at the IPO)

ISDX.com

(according to my calcs. the WESP NAV is now around 111p and the official price yesterday was 57p to sell and 62p to buy
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Why dont I just buy quietly for myself ?
I have a few already. Dont need any more. Too many eggs in 1 basket etc.

Do I want some buyers so I can sell some ?
No. ..the discount to NAV is too big to sell any at present imo..and rising nicely...but I wouldnt mind if the share price went up ...and the discount to NAV reduced !?


fulltimeinvestors.com

[smithie6] 22/8/2014 08:43

:-)

(but hope the price doesnt run ahead of itself....otherwise it will overrun and then could create a down trend)

[nw99] 22/8/2014 08:04

Broken out on the chart

[melf] 21/8/2014 12:08

A very positive write up in this week's Shares Mag.

[smithie6] 19/8/2014 14:25

the share price run over last few months probably knew that some oil/gas sector cos are doing OK

WG.
"John Wood Group PLC: The energy-services company rallied 4.3% after backing its full-year guidance for earnings before interest, taxes and amortization."

[nurdin] 16/8/2014 10:55

Nice tip in IC...should see further advance on Monday

[smithie6] 15/8/2014 10:32

...nice to see the share price doing well...

[montynj] 15/8/2014 09:32

Bought them today...fantastic bullish breakout on chart too

[nurdin] 15/8/2014 08:32

cheers...tipped them again it seems.