Babcock Share Discussion Threads

[jelfsie] 23/3/2004 16:13

Yep, out today at average 124p for a 7% profit. Oh well, at least I live to fight another day but I hate it when a deal does not go my way (although I also know not to get too attached).

[boadicea] 23/3/2004 13:00

Jelfsie - Cannot disagree. I left early yesterday having convinced myself the near future looked dubious - and needing some funds for HAMP rights which look more promising imho.

[jelfsie] 23/3/2004 09:57

Well having looked at the facts I fail to see the benefits of this deal. There are some synergies I accept, but hardly massive. The only benefit I can see, which to date is unquantifiable, is the level of compensation that might be due from Network Rail. If they eventually get anything up to £15 - £20M the deal makes good sense. Otherwise, I suspect we have a case here of BAB's management getting tired waiting for its order book to grow significantly, and seeing an opportunity to acquire substantial sales without dilluting EPS (bigger sales enable them to pay themselves bigger salaries). Nonetheless, this does not compensate for the execution risk (PHS management appear to have buckled at the first sniff of a suitor which does not auger well) and, accordingly, I intend to sell out of BAB and watch from the sidelines. Disappointing I know but thats life. I have made a small profit, and will look for other more profitable opportunities.

Good luck to those who intend to stay.

[jelfsie] 20/3/2004 18:39

The big unknown here is what level of compensation might be paid by Network rail. If BAB get PHS for £106M (which they may not), and then got a substantial sum of cash from the lost network rail contracts compensation then they would have completed a nice deal. Not all that positive, however, i.e. do we read into this move that the MOD work is drying up?.

[biggcl] 19/3/2004 14:33

rbennet - but they ain't flying!!!

[rbennett] 19/3/2004 14:05

see told on the 12 of feb this would happen

[dr darkstar] 08/3/2004 12:21

Ticking up again

[jelfsie] 02/3/2004 09:27

Well unfortunately I didnt get any at 120p. Still, got quite a few already. Think we need some more positive contract news before we see 150p + so I'll be taking some profits before then if I get the chance. As an example, BBY has confirmed order book of about 2.5 years annual revenues. As it stands BAB has only 1.5X which is why I believe the shares are being held back. The pipeline is, however, large and BAB has a good track record in turning this into orders. The market needs this, and confirmation that Rosythe is getting good orders from the up and coming aircraft carrier contracts, before we will see progress above 150p IMO.

[dr darkstar] 01/3/2004 22:52

looking strong now and after the lengthy consolidation I'm looking for a breakout towards 150

[dr darkstar] 01/3/2004 08:16

and another tick up

[dr darkstar] 28/2/2004 20:45

could be trend reversal now

[jelfsie] 24/2/2004 12:41

Well trawled everywhere and cant find anything, recent weakness on low volume so not concerned. Nonetheless, no annoncements on contracts since November so this might explain the recent weakness unfolds. Not much support now until 120p again so I'll wait until then.

[jelfsie] 20/2/2004 11:08

Just come back from a break and see the price at 125p. Does anybody know anything on the contract front?. Tempted to buy more at this level but need to check some of the news sites out before I do.

[jelfsie] 12/2/2004 12:13

Toying with buying some more as we push at 130p. Still have a feeling we could see 150p in next 3 months with more contract news. This IMO is what is holding these back. The market is pretty much saying that EPS of 13p is now guaranteed for 2004 but it is 2005 where jitters exist due to Rosythe and some believe BAB will struggle to grow revenues and profits (and EPS) in 2005. If this changes over next 3 months expect 20% upside from here. I am pretty comfortable with buying at 10 times 2004 earnings and a nailed on dividend yield of 2.5%. The generation of cash flow at the H1 stage shows that this management know what they are doing. COME ON PLEASE DROP THE ASK TO 130p.

[boadicea] 30/1/2004 18:57

Looks like you (jelfsie) and me are the only ADVFN followers BAB. However, it is definitely looking more active now. I think it has good defensive qualities and with some other plays looking a little tired after recent advances it may well attract further attention imho. The recent rise is relatively modest (so far) but looks more impressive against the downtrend of the past week.

[boadicea] 29/1/2004 16:08

Holding rather well today, against the trend.
This link probably explains recent strength and a good portent for the future - Schroders have just acquired another 3% and now hold >17% in total.

[boadicea] 28/1/2004 13:49

Another possibility - The dividend was paid last Friday, I believe, but I received notification from com.direct this morning. If this implies that dividends for accumulation accounts were used today to buy more shares grouped in nominee names that could account for the coordinated surge in buying. This is one reason why I never choose auto-reinvestment - It's a gift to the mm's who can see it coming 6 weeks ahead! However, if it's stimulated a break-out, we should all be thankful.

[boadicea] 28/1/2004 12:51

No. But that was a very concentrated series of medium size buys starting at 11.09am and lasting about half an hour, so looks like a close-knit group of investors somewhere think they know something.
Interesting that yesterday was ALL sells but price held steady.
I will keep a watch, Jelfsie, as I expect you are also doing.

[Edit - above time corrected from 10.09 to 11.09. It is also interesting to note that the price did not react until 11.25 approx. when 80k of the 110k of buys had already gone through.]

[jelfsie] 28/1/2004 12:39

Boadicea or anyone, help me. Has somebody got wind of contract wins in the pipeline?. Thanks.

[jelfsie] 22/1/2004 13:17

Hope so, but looks like we will need more positive news on contracts to achieve this. Nonetheless, this is a useful "consolidation" phase above the old resistance of 120p area (spike in 2002 excepted).

[boadicea] 22/1/2004 10:07

Looks like an attack on the recent high (131p) might come soon.
Some of the steam seems to be going out of the small cap market and some of the steadier mid caps like this could be the benficiaries imho.