Mears Share Discussion Threads

[rivaldo] 11/12/2009 08:45

That's the opportunity for MER - reductions in direct gov spending will bring huge opportunities for MER via outsourcing.

The market is also migrating towards far bigger contracts, which are being won by proven players like Mears.

There is a convergence between MER's social housing and care businesses, with increasing opportunities to combine its care and repair services, that should only increase in future years, no matter what political party forms the Government.

The political scene is driving increases in domiciliary care.

Besides, there's the long-term nature of MER's recurring income - some contracts run through to 2019/2020 from memory.

And then there's the significant opportunites for MER re the 2012 Olympics village...

[simon gordon] 10/12/2009 17:46

D-day is coming closer for the likes of MER:

Hamish McRae in the Indie - 10/12/09:

"There is a parallel problem on the spending side. We don't have much detail on the plans beyond next year and we were not given much more yesterday. However, embedded in the figures are really savage cuts. Take public investment. The Chancellor boasted how high public investment was this year and said he was determined "to build on these strengths by... boosting investment in our national infrastructure and skills".

Well, on page 189 there is indeed a table that shows that net public investment this year is 3.5 per cent of GDP. But by 2013/14 it falls to just 1.3 per cent of GDP. That is brutal, particularly so since the burden actually falls on the private sector, the construction and engineering that carry out the investment. I don't think people have any idea quite how serious the squeeze on spending will be, even on this government's own plans."



Coffee House - 10/12/09:

"The Institute for Fiscal Studies says that government plans imply £36bn of cuts in departmental spending ie over 19% from 2011-2014 in order to protect schools, hospitals and increase overseas aid. They say the police pledge is meaningless. They also say that defence, higher education, transport and housing are most likely to be hit.

The cost of paying back the debt over the next eight years is equivalent to £2,400 per family in taxes or cuts over that period."

[rivaldo] 06/12/2009 19:21

Thx CWA1. I appreciate your appreciation :o))

On Friday Panmure's reiterated a Buy here, with a 330p valuation.

Not much more need be said.

[cwa1] 30/11/2009 16:06

Usual good stuff r. Keep up the good work it is appreciated!!

[rivaldo] 30/11/2009 16:05

News - a contract win re gas maintenance contracts in Birmingham:



"Mears Group will provide the gas service to the areas of Hodge Hill and Yardley"

[rivaldo] 20/11/2009 10:58

More here:



"Panmure Gordon has hiked its target on Mears Group from 260p to 330p and repeated its buy rating. That will be warmly received by chairman and Oldham's best-known son Bob Holt. He was disappointed this year when shares in the social housing and care group missed out on promotion to the FTSE 250 index by just a penny. Today the shares traded unmoved at 278½p."

[rivaldo] 19/11/2009 13:48

Good news today - looks like all the brokers are coming to a consensus of 300p-330p.

I may have to ISA some more:



"Panmure Gordon...maintains buy for Mears, raising target to 330p from 260p"

[rivaldo] 15/11/2009 07:24

Nice plug for MER in Derek Pain's investment column in the Independent yesterday:



"Mears, a constituent of the no pain, no gain portfolio, is one deserter. It moved up market to full listing last year. The support services group has a strong record and should hit new profit highs this year. Chairman Bob Holt, in a trading update, said it had "experienced strong trading across all divisions". Around £450m of new contracts have been gained since March and the order book is £1.7bn.

With much of its income stemming from social housing and home care – two areas where significant spending cuts are unlikely – Mears should withstand the impact of the recession better than most."

[rivaldo] 13/11/2009 12:26

A 20k buy first thing today and looking strong.

[rivaldo] 12/11/2009 19:02

Thx Mr Garden - already posted here ages ago though :o))

Ta chrisfoster. Shouldn't take much to see a breakout here imo - another contract win should do it.

[investinggarden] 12/11/2009 11:21

Strong Buy Rating from Growth Company Investor

[chrisfoster] 12/11/2009 07:59

rivaldo - nice work on the last two finds, cheers. :-)

[rivaldo] 11/11/2009 14:15

Excellent review in the IC:



"Mears "never stronger"
Created: 28 October 2009 Written by: Algy Hall

While the recession is proving a drag on the performance of other businesses, social housing group Mears says demand for its services "has never been stronger". Order intake since its March year-end now totals £450m with a number of big opportunities on the horizon. Forecast turnover for the year is almost in the bag already, and its £1.7bn order book includes 72 per cent of forecasts for next year, too.

About 90 per cent of Mears' business is in the defensive end markets of social housing and at-home care. Performance at both divisions was strong. But the cyclical slice of turnover from the group's mechanical and electrical division was also noteworthy for its strength. A strong foothold in Canary Wharf has helped the construction-focused business win promising Olympic-related work.

Broker Charles Stanley predicts adjusted full-year EPS of 22.3p rising to 25.6p (19p in 2008).
-------------------------------------------------------------------------------
SHARE TIP UPDATE:
Buy
At 278p, the shares are priced at 12.5 times predicted earnings. While the price is nicely up on our tip, it remains far from challenging, especially by historical standards. Buy"

[ghurah] 11/11/2009 13:52

off topic (in case some people mind)

is there anyone here that can help me?....read on...

are you working in the construction industry and would like to take part in a short (5 questions, 3-5min) questionaire i will be doing as part of my final year project?

I would appreciate as many responses as possible and would really help me...
if yes then please email me for further information:

[e-mail]

all confidential etc

[rivaldo] 11/11/2009 12:14

Moving up - hopefully this is a consolidation phase before a move to a higher trading range.

[rivaldo] 10/11/2009 09:11

MER interested in bidding for a 10-year, £200 million framework covering Decent Homes and planned improvement works to housing in South-west London:

[rivaldo] 04/11/2009 16:10

I will :o))

Interesting new article about creating a "sustainable" housing market:



Extract:

"Tackling the challenge

According to Paul Kellaway, commercial manager of social housing repairs and maintenance specialist Mears Group, the option of retrofitting is the only way by which Britain can tackle the sizeable challenge of bringing up to code Britain's social housing, which represents the oldest stock of housing in the developed world.

"The Committee on Climate Change suggests that emissions from housing stock need to be virtually eliminated by 2050," said Kellaway, "but at our current rate of demolition and building of new properties, it would take 1000 years to replace existing stock with zero carbon new homes.

"Where our situation differs from the French is that our stock is often terraced and semi-detached housing, generally constructed in brick or stone and will be considered to have architectural character or heritage values within the streetscape or neighbourhood," explained Kellaway.

"Yet for medium- and high-rise flats, the sort of rainscreen or insulated cladding solutions offered by companies like Carea may provide solutions for both improving insulation values and enhancing appearances.

He continued: "We need to embrace the culture of retrofitting wherever viable, as the French have, if we are going to successfully tackle the challenge of improving existing stock."

New builds: the French connection

With regards to new builds, the local authorities and RSLs have, at least on one occasion, looked to the French for inspiration – and on that occasion, it paid considerable dividends.

Bourbon Lane, a development in West London that was designed and built for an international competition by a collaboration of two architects – one from London, one from Paris – picked up a series of prestigious accolades as an innovative, contemporary solution to modern housing issues.

Dino Coursaris, director of the French firm in the partnership, B+C Architects, said: "In France I believe we have a more contemporary approach to urban construction – authorities are more open-minded in accepting radical architectural styles and use of external cladding is a natural choice.

"With Bourbon Lane, we took the client over to see examples of social housing in Paris, which is very compact, very dense, with a creative approach to cladding," continued Coursaris. "After seeing how successful this was, the client wanted us to do the same for this development and, if authorities in the UK are to address problems of social housing, they should also be keen to embrace this innovation by considering thermal envelope and airtight construction."

A light touch

With new builds, therefore, there are means by which we can ensure high standards of sustainability, as demonstrated by the Bourbon Lane project, which in turn affect the need for retrofitting in the future.

Paul Kellaway of Mears explained: "Considering in the initial design how a building might be upgraded in the future to achieve higher levels of the code through renewables might help design out future redundancy in housing stock. Whilst it might increase initial build costs, it will reduce retrofit and maintenance costs in the future."

But for the terraced and semi-detached housing that comprises the majority of the UK housing stock, what is the answer?

Carea's Atkinson concluded: "Because the culture is different here than in France, I believe many are too quick to assume that cladding is impractical with a lot of housing stock. It would be beneficial for the UK market to welcome the option of cladding more readily."

"With existing 'hard to treat' properties where retrofitting is truly impossible , a lighter touch is required" said Paul Kellaway of Mears, "Tenants can make a huge difference by actively pursuing eco-friendly practices, hence why Mears work very closely with tenant groups to make small changes add up. The effect of this involvement leads to improved outcomes for the individual, their homes and the community as a whole.""

[cwa1] 02/11/2009 22:14

Thanks rivaldo, keep up the good work :-)

[rivaldo] 02/11/2009 19:58

Nice summary on GCI. Don't forget MER is ISAble:



"Mears Group
STRONG BUY 30/10/2009
James Crux

Support services star Mears still offers investors growth aplenty in the defensive social housing and domiciliary care services markets, where spend is non-discretionary and the risk of cuts very low.

Long-established as the leading social housing repair and maintenance provider, Mears is also building a presence in domiciliary care, where it delivers more than 90,000 hours of care to 13,500 people or more every week.

For 2008, Mears delivered its thirteenth consecutive year of double-digit sales growth, with sales surging almost 40% higher to more than £420m and profits reached record levels in Mears' first year since graduating to the Main Market. More recent interims to June, unveiled by chairman and chief executive Bob Holt, further underscored the group's defensive credentials, with sales up nearly-15% to £233m and operating profits pushing 18% higher to £10.8m.

Since March, the group has clinched new contracts worth in excess of £450m, building its order book to £1.7bn plus, whilst the bid pipeline remains plentiful. In social housing, the bid pipeline stands at £3.5bn, underpinned by the market migration towards far bigger contracts, which are being won by proven players like Mears, able to deal with their complexities.

Significantly, Mears continues to spot a convergence between its social housing and care businesses – there are increasing opportunities to combine its care and repair services – that should only sharpen in future years, no matter what political party forms the Government.

Based on 2009 estimates, pointing to increased earnings of 22.4p (2008: 19.6p), Mears shares, offering a progressive dividend-income stream, are selling for around 12 times earnings, an undemanding rating given its superb track record and robust growth prospects."

[rivaldo] 28/10/2009 10:26

Good coverage in today's Mail:



"Bob Holt's social housing and care services provider Mears jumped 6.5p to 279.25p on a bullish trading statement. Full-year results will be in line with expectations and the group has won new orders worth another £450m-plus since interims in March.

The Social Housing bid pipeline has increased 20% to £3.5bn and £1.5bn is now at the active tender/advanced bid stage compared with £860m at the interims. Collins Stewart's target price is 335p."

[rivaldo] 27/10/2009 14:58

Numis have upgraded today - a 316p price target:



"LONDON (SHARECAST) - Mears Group has been upgraded by Numis Securities after the housing repair firm issued a comforting third quarter trading update.

The broker has left its full year earnings forecasts unchanged but has upgraded Mears from 'hold' to 'add' after the shares underperformed the FT All Share index by 8% over the last month.

'We believe there is scope for the shares to aspire to at least a market rating (i.e. PE [price/earnings ratio] of up to 13x, the basis of our target price) though the journey may be sporadic as the wider investor base has some concerns on the robustness of Social Housing R&M [renovation and maintenance] outsourcing trends and size of spend over an election period,' Numis analyst Francesca Raleigh said.

Numis has a price target of 316p for the stock."

[rivaldo] 27/10/2009 09:01

:o))

And more work announced today - got to go, so haven't got time to check if it's mentioned in today's RNS (don't think it is?):



"Council homes upgrades go-ahead
8:40am Tuesday 27th October 2009

WORK is set to start on upgrading more than 2,000 council homes in the new year after two contractors were given the work.

Attempts to bring the 6,000 properties, run by Colchester Borough Homes, up to the Government's Decent Homes standard have stalled since a contract between the organisation, Colchester Council and contractor Inspace ended in June last year.

Colchester Council's cabinet agreed a contract for internal works, such as kitchen and bathroom upgrades, to Apollo Property Services Group and Mears."

[cwa1] 27/10/2009 08:53

No rivaldo, I don't deal in pocket money trades ;-)

[rivaldo] 27/10/2009 08:44

Glad to hear of it CWA1 - was that your 100k bought at 282p then? :o))

Could see new recent highs over 300p fairly soon if all goes well.

[cwa1] 27/10/2009 08:22

Just in case anyone can't find the RNS without help ;-)



Agree riv, I haven't seen a more upbeat update for many a long day :-) Added a few first thing this morning on the strength of it. Fingers crossed.