Severfield Share Discussion Threads

[rivaldo] 23/11/2016 09:45

The IC are definitive - Buy:



Extract:

"The group's order book stood at £315m at the beginning of November, representing a six-year high, and a 17 per cent increase in just five months. Major contract wins in the first half include a tower project at 22 Bishopsgate, London and the Graphene Innovation Centre in Manchester. The backlog is expected to feed through into increased production volumes and revenues in the second half.

Jefferies has upgraded its forecasts for March 2017 full-year profits and EPS to £17.9m and 5p, respectively, rising to £20.8m and 5.7p in 2018 (from £13.2m and 3.7p in 2016)."

"IC VIEW:

The group is set fair to achieve its target of doubling its underlying profit before tax over the next four years. Strip out net cash, equivalent to 8.2p a share, and Severfield trades at just 11 times FY2018 earnings - get your wallet out. Buy."

[rivaldo] 23/11/2016 07:37

Brief analyst comment FYI:



Extract:

"Chief executive Ian Lawson (pictured), who was brought in to turn around the loss-making business by chairman John Dodds in November 2013 after leaving Kier earlier that year, said he expected profit for the full year to be ahead of expectations.

Cenkos analyst Kevin Cammack said: “These are cracking interims featuring stand-out margin growth from 4.3% to 7%.” He added that he expected full year profits to be around £18m, up from his previous estimate of £16.5m.

Lawson added: “We have a strong platform from which to implement our strategy, which targets to double our underlying profit before tax over the next four years and continue to create value for our shareholders.” The firm increased its dividend by 40% to 0.7 pence."

[luckymouse] 22/11/2016 20:03

118-128p an area of strong significance on the long term chart

[cc2014] 22/11/2016 19:32

Happy to see this company have now turned the corner. And looking at projects in Europe ;-)

[hybrasil] 22/11/2016 19:19

We'll get to £1.50 but it will take time

[columbarius] 22/11/2016 14:59

And I don't think it was luck either!

[luckymouse] 22/11/2016 12:18

Told you it would go to 70 :)

[rivaldo] 22/11/2016 11:44

Nice comment from the CEO about increased opportunities in Europe:



Extract:

"Chief executive Ian Lawson, also eyeing work on the new Hinkley Point nuclear power station and the HS2 rail project, added that there were “more opportunities” in Europe, thanks to the pound’s slump making it more competitive.

“We have done the odd job in Paris and Amsterdam,” he said.

After a 69% jump in pre-tax profits to £8.1 million in the six months to September, the dividend is up 40%, the order book is in the best shape for six years and full year profits will “be comfortably ahead of expectations”."

[roddiemac2] 22/11/2016 10:47

I have been sitting on the residue of a large holding for years: too slow to sell ( the laid back investor! ), so I am pleased to get confirmation that the business has emphatically turned the corner.

Nice to see that the Indian JV is looking promising for the long term. I have always thought it was a wise decision to get involved there.

[owenski] 22/11/2016 10:11

Cheers Kin, yes, have heard of BILN

[napoleon 14th] 22/11/2016 09:54

Back in here after being out for many years.
IMO false dawns are behind us at SFR...

[kinbasket] 22/11/2016 09:31

Hey Owen, if you like this sector you might be interested in Billington BILN.

Won't pollute this board, but details of whats happening are on the BILN board.

[owenski] 22/11/2016 09:00

Super results, nice to be on a fairly quiet board too, thanks for the posts Riv.

[itchycrack] 22/11/2016 08:48

Couldn't agree more rivaldo - boring is not just good, its great! :-)
When the 99% of O&G punters have lost their money they will begin to realise its the 1% who are usually right 99% of the time :-)

[rivaldo] 22/11/2016 08:29

Lots to go for given order books etc. SFR was always rated at a premium in the past - if it returns to those valuations then we could see 100p+ over the coming months.

It always befuddles me to see thousands of punters on O&G and mining threads chasing usually unfulfilled dreams, whereas this thread exists with just a few of us where those punters could have made 40%+ in a very short space of time - with loads more potential upside - in a "boring" structural steelwork company :o))

[hybrasil] 22/11/2016 07:40

What sort of price rise will we see today? Will it end up 70pbid?

[itchycrack] 22/11/2016 07:37

Cracking update!
I've been adding here on and off over the past year in the firm belief this will eventually prove to be an excellent recovery story! So very happy indeed with progress to date :-)

[rivaldo] 22/11/2016 07:22

H1 results are terrific, and most importantly full year results will be "comfortably ahead of expectations":



"I am delighted with our strong performance in the first half, which has continued since the period end. Margins are significantly up, our order book has continued to rise to a six year high whilst our pipeline remains steady. In combination with the strong cash generation in the first half, this has given us the confidence to increase the interim dividend by 40% and we expect profit growth for the full year to be comfortably ahead of expectations."

[hybrasil] 22/11/2016 07:21

Smashing results

[rivaldo] 18/11/2016 10:45

Good news - "ministers pledged to use mostly British steel to build tracks for the HS2 rail link":

[luckymouse] 15/11/2016 23:24

Steel prices climbing significantly

[rivaldo] 15/11/2016 15:09

New recent highs now.

[rivaldo] 14/11/2016 08:16

New tip for SFR....



"An impressive recovery

Looking at other engineering firms, I see shares in structural steel supplier Severfield (LSE: SFR) have also been through some ups and downs of late, though a rally since early July has seen them recover to a loss of 4% over 12 months — but over five years we’re looking at a 39% fall.

Earnings have, however, grown nicely over the past couple of years, and there are double-digit EPS rises on the cards for this year and next. That would give us a forward P/E of 13 for the year to March 2017, dropping to 10.5 on 2018 forecasts — and suggests PEG ratios of 0.5 for the next two years, where around 0.7 or lower is generally considered a good growth indicator.

On top of that, the firm’s dividends, which were curtailed in 2014, have already been reinstated and are set to show some nicely progressive gains — after yielding 2.7% this year, analysts are expecting increases of 23% and then 22% which would take the yield up to 3.7% by March 2018.

In its AGM trading update in September, Severfield told us that its UK order book stood at £268m as at 31 August and had “remained at a very strong level in the period following the EU referendum result“, adding that “Our pipeline of potential future orders has also remained stable with a good balance of work across all key market sectors“.

In addition, an order book of £37m in India apparently “continues to generate an encouraging level of new opportunities amid signs that economic optimism in the country is beginning to increase“.

First-half results should be with us on 22 November, and I’ll be looking for more signs of an impressive recovery."