Ashtead Share Discussion Threads

[disc0dave45] 08/12/2022 10:55

Good day Mr bThanks for your chart.One question - isn't the "gap" you mention very tiny at 3p (high 31/10 4561, low 3/11 4564), so when is a gap deemed to be a gap?Thanks

[bracke] 07/12/2022 18:43

AHT at first support.
The gap at 4550 becomes a target. High probability of a fill by end of January if not end of December.

AHT DAILY

[bracke] 07/12/2022 18:40

disc0

"Would some stocks though because of the sector they operate in (eg defensive) react contrary to the market, so TA the relevant sector index?. Guess there aren’t many though."
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Yes you are correct. It's always worth looking at the Sector Indexes. The market likes to rotate out of some sectors and into others when it thinks one/some have gone up or down enough and into those that have relatively done the opposite.

But when the the issues are wider and the market takes fright there are few that avoid the panic.

[perfido] 07/12/2022 18:32

Nice one disc0,

Most encouraging 😊.
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[disc0dave45] 07/12/2022 18:15

RBCAshtead's "strong" Q2 earnings and raised full-year 2023 outlook had led it to lift 2023 and 2024 earnings per share estimates by roughly 6% and 9%, respectively. As a result, RBC said its price target also pushed up as the group "continues to execute well" in its core US market, where the supply/demand balance remains "highly favourable", driving both volume and rate improvements. "Although some historically reliable demand indicators have rolled over, Ashtead is convinced that the non-resi project pipeline is robust and that significant fiscal stimulus creates a rich seam of counter-cyclical rental equipment demand," said the Canadian bank. "We continue to see AHT as a structural long-term beneficiary in the fragmented North American equipment rental market, with optionality around international expansion. Management is best in class, and we see the revenue mix as ever more resilient, bolstered by rapidly-growing, under-penetrated specialty solutions and the near-term stimulus of the vast US Infrastructure, CHIPS and Inflation Reduction Act in coming years."

[disc0dave45] 07/12/2022 17:31

Mr bSounds sensible.Would some stocks though because of the sector they operate in (eg defensive) react contrary to the market, so TA the relevant sector index?. Guess there aren't many though.

[bracke] 07/12/2022 16:37

disc0

There are a some chartists whose analysis I do find useful. There are those whose analysis is correct but that is insufficient if they do not include their analysis of the market. Confused? Let me explain.

Analysing a company's share price chart may suggest it is going up or going down BUT the wider market may be signalling the opposite. There is data/charts that assist with determining the general market direction.

[fenners66] 07/12/2022 15:49

Seems H&E and URI have taken on board the read over from AHT results and have made share price gains.
Whilst AHT goes backwards...

[disc0dave45] 07/12/2022 13:48

Good day Mr b"So which 'experts' do you follow"None. However, I do take onboard consensus targets in terms of earnings mainly. But unfortunately the market does hang on to their "forecasts" and opinions, which aren't always correct, far from it.Have a good one, the markets wobbling so no doubt you will :)

[trt] 07/12/2022 13:06

Could see this drop to £45

[bracke] 07/12/2022 12:19

Good day disc0

"Morgan Stanley raises Ashtead price target to 5,000 (4,830) pence - 'overweight'"
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What am I missing? If this is an upgrade they are way behind the curve. Since November 22nd it's been moving up to 5100-5200!

So which 'experts' do you follow. Take your pick 5,450, 5,000, 6,000, or 6,600. That's a range of 1,150 (21.10%).

[disc0dave45] 07/12/2022 10:50

On that sample of brokers estimates they've raised the TP by an average of 4.2%. No surprise I guess as AHT raised Rev guidance by an average of 3.5%.Hopefully another upgrade at Q3 :)

[disc0dave45] 07/12/2022 10:34

Sorry, missed a few more:Bank of America raises Ashtead price target to 6,600 (6,500) pence - 'buy'----------Barclays raises Ashtead price target to 6,000 (5,650) pence - 'overweight'----------RBC raises Ashtead price target to 5,450 (5,150) pence - 'outperform'

[disc0dave45] 07/12/2022 10:33

Morgan Stanley raises Ashtead price target to 5,000 (4,830) pence - 'overweight'

[fenners66] 06/12/2022 22:14

Exceptional items

As now every set of accounts

Write-off of deferred financing costs $ 11.1m
Early redemption fee $ 36.0m

So pre-tax $ 47.1m

As if we never saw that "exceptional " coming

[perfido] 06/12/2022 22:06

fenners,

You are making the same mistake as before, the stated progressive dividend policy is determined by consideration to both profitability and cash generation which is sustainable through the cycle, not your personal financial needs.

Clearly if you disagree, you are in the wrong share, no amount of moaning about it will change the company’s policies, you have been beefing about this for some time without success.. give it a rest?
.

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[fenners66] 06/12/2022 21:57

Additionally....that which is available after...

So why was only 2.5c out of the increase of 54.9c allocated ?

Absolutely agree with the new sites , bolt on acquisitions etc , but clearly funds spent , were not made available for dividends and we know what they were spent on.

[perfido] 06/12/2022 21:50

Hi fenners,

The buyback is mentioned in the final paragraph of the Capital Allocation plan above…
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[fenners66] 06/12/2022 21:37

bracke - ok guilty of not selling near the top or buying near the bottom.....

about 20 times which I guess makes the crime all the worse....

or the defence all the better.

perfido
thanks for the re-iteration no problem with me for the 5 point plan above , as you can see the idea with buy and hold is a "good company" that maximises its profit, that's actual cash profits , not EPS.

But the 5 point plan does not even mention buybacks , the progressive dividend for this half increased by 2.5c when earnings increased by 54.9c so clearly allocation of dividend is being held back by something....

[perfido] 06/12/2022 19:45

Capital allocation Plan (reminder)

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The Group remains disciplined in its approach to allocation of capital with the overriding objective being to enhance shareholder value.

Our capital allocation framework remains unchanged and prioritises:

-- organic fleet growth;
- same-stores;
- greenfields;
-- bolt-on acquisitions; and
-- a progressive dividend with consideration to both profitability and cash generation that is sustainable through the cycle.

Additionally, we consider further returns to shareholders. In this regard, we assess continuously our medium-term plans which take account of investment in the business, growth prospects, cash generation, net debt and leverage. Therefore, the amount allocated to buybacks is simply driven by that which is available after organic growth, bolt-on M&A and dividends, whilst allowing us to operate within our 1.5 to 2.0 times target range for net debt to EBITDA pre IFRS 16.
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[perfido] 06/12/2022 18:30

Some good points being made here, but viewing the chart below? I wish I could 😊 (see post 61609)

In the meantime I am not unduly worried about the level of dividend, I am happy to hold shares in a successful company that follows their capital allocation plan, and if you don’t agree with that plan I would question whether you are invested in the right share?

I am also happy to buy or sell the shares as the whim takes me.

If you require an income stream you always have the option to sell up and switch to another income share, (capitals gains tax should not be an issue for the cognoscenti investor) or you can sell sufficient shares to make up your income deficit.

Moaning about the level of dividend is never going to change the company’s capital allocation plan, and frankly is getting all too predictable.
☹️
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[disc0dave45] 06/12/2022 18:22

Good evening Mr b"If a company is paying a good rate of dividend I can understand the non active approach but if like AHT it isn't then non active is not a very profitable method."Agree completely. Can't understand why someone would still hold knowing that at £65 it was ahead of itself then watch it fall all the way to £32 and just hold on for what exactly?, a div of 0.8%.....don't buy the CGT argument either, not when the amount of tax is less than the capital loss incurred. But then I struggle with maths / numbers!, pfft.Each to their own I suppose :)

[bracke] 06/12/2022 16:06

fenners

"Those that have held for many years know that would be stupid."
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No I didn't miss it.

I wasn't suggesting that investors should become traders, far from it. What I was suggesting is that investors should develop skills that would help them to decide when it was a good time to sell.

Is holding a share to the high and continue to hold it to the low good investing? I think not. I am not saying that investors or traders will buy at the absolute bottom or sell at the absolute top but getting somewhere closeish is better than seeing all the gains disappear.

Viewing the chart below illustrates my point. Buying and continuing to hold whilst the share price rises and then falls a long way back down is not good investing.

EDIT. Apologies I forgot the chart.

[fenners66] 06/12/2022 14:32

good day bracke

But you missed the next bit

"Those that have held for many years know that would be stupid."

Sure some can make trading profitable - but what are the stats ?
90% lose money ?
However buy and hold a good company is the way.

Better would be buy and hold a good company that ignored the instis clamour for trading liquidity and buybacks and got on with building as profitable business as they can , and..... paying a reasonable % of earnings as a dividend.