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| Share Name | Share Symbol | Market | Stock Type |
|---|---|---|---|
| Coats Group Plc | COA | London | Ordinary Share |
| Price Change | Price Change % | Share Price | Last Trade
|
|
|---|---|---|---|---|
| -1.50 | -1.59% | 92.80 | 16:08:59 |
| Open Price | Low Price | High Price | Close Price | Previous Close |
|---|---|---|---|---|
| 92.30 | 92.30 | 93.80 | 94.30 |
| Industry Sector |
|---|
| GENERAL INDUSTRIALS |
| Top Posts |
|---|
Posted at 08/5/2024 00:56 by manurere I am not sure if anyone else is active on this site.In the event that there is, we now know from a recent disclosure, that a significant institutional investor, abrdn, has recently been buying Coats shares and that its holding has now gone over 5%. We cannot tell from the disclosure how many shares abrdn bought. Given that I had expected the share price to languish around 72p following the last results announcement, the abrdn move is encouraging. In my view, abrdn is a quite savvy institutional investor. |
Posted at 21/12/2023 12:09 by theoriginalwonderstuff As soon as I sold out this rose very nicely to 80p...Stock investors should pay me not to buy their holdings!!! lol... |
Posted at 02/8/2023 02:33 by manurere I am, as EI knows well, a long time, bullish Coats investor. My partner and I each have, for private investors, quite large holdings.I was very pleased with the half year results, given the Q1 report. As EI has noted, costs continue to be trimmed, acquisition integration seems to be on track, and market share is growing. My particular focus is on performance materials, rather than footwear and apparel. Over the past decade I have watched every video and studied every statement Coats has produced on performance materials, including industrial materials. This is cutting edge manufacturing with good margins. It also provides some insulation from the ups and downs of consumer spending. I believe that the medium term outlook for performance/industri As for Tuesday's trading, on opening the share price dropped a couple of pence on small volumes, but then the smarter money arrived and the price went up. That buying might have over-reached a little, but I suspect that this time we have left 70p and below behind us. (Mind you, I've said that before and ended up with egg on my face!). Finally, while it is only 15%, the increase in the interim dividend tells us that a very conservative board--when it comes to rewarding shareholders--is confident that Coats is on track to be able to sustain regular, small increases in dividends. I am confident that we will hit US5 cents a share this decade, probably in FY2028 or FY2029, but maybe earlier. If you own Coats shares, hang on to them. If you are thinking of buying, jump in. |
Posted at 04/3/2023 07:32 by manurere Thanks EI and j.f.t.m.I was going to wait until after Monday and Tuesday’s trading. The results were better than I had expected. *The strategic expansion of the footwear investment is reaping quick rewards. *I note the steady increase in both market share and margins as Coats exits hisorically high volume, low value production. *I still believe that we will see some quite significant growth in performance materials over the medium- to longer-term. *Really pleased that an end to the pension overhang is now in sight. *Appreciate the dividend boost. *Note that the CEO has increased his shareholding: an encouraging vote of confidence. *Thought that some investors got a bit carried away on 2 March; the share price got ahead of itself. *I still think share price will hover around 75p until mid-year results; they may see share price move closer to 80p. *Will be surprised if share price goes over 100p before mid- or FY results 2025. See no prospect of a takeover bid. First, a very high percentage of shares are in institutional hands. Second, most seem to be index linked investments with no incentive o make a quick buck, should it be offered. Third, at what price would we sell, given some of us have hung in for a long time? I won’t voluntarily exit this side of 155pence as I see too much upside from just hanging in. I’m looking forward to US 5 cents a share in annual dividends before my kids inherit the shares. |
Posted at 22/2/2023 08:53 by manurere It looks like the expectation of positive annual results are now baked into the share price. While I think Coats will trade in the 70p to 75p range until the 1st half 2023 results, I am still of the view that investors continue to underestimate this company's future, positive earnings/profit trajectory. In my view, even at 73p COATS is still a good buy. |
Posted at 12/11/2022 20:01 by simon gordon Liontrust Growth Fund October update - 9/11/22:Coats Group (+20%) moved higher as investors reacted positively to a Capital Markets Day focused on the company’s footwear division. Coats has expanded the scale of its footwear unit significantly recently with the acquisitions of US businesses Texon and Rhenoflex. It has now issued medium-term sales growth guidance of 7% to 8% per annum for footwear, with an operating profit margin target of over 20%. This higher forecast for the division has shifted up the overall group’s medium-term targets (inclusive of its apparel and performance materials divisions) from 5% to 6% sales growth per annum, with an operating margin target of 17%. Coats also reiterated the message, already conveyed within interim results, that it has been able to offset cost inflation through price increases and internal efficiency measures. Pricing power has long been one of the most valued characteristics we look for in the Economic Advantage investment process, stemming in our view from the barriers to competition provided by companies’ intangible and difficult-to-replica |
Posted at 12/10/2022 06:19 by manurere I strongly recommend that everyone reading this thread download yesterday's outstanding capital markets presentation by Coats management.It is on the Coats website under investors.The slide show outlines in very informative detail the rationale behind recent acquisitions and how they place Coats in a dominant position in footwear. For a long time I have been commenting on the strategic nous behind this company's recent progress. Yesterday's presentation confirms the wisdom of sticking with Coats as a very long term investment. |
Posted at 16/8/2022 08:07 by manurere I am not sure how many of you receive Coats email notices; they are worth subscribing to.Yesterday I received one that outlined the directors' uptake of the recent share offer, which I can confirm was at 63.5 pence/share: David Gosnell (Chair): 157,480; Rajiv Sharma (CEO and Director): 157,480; Jackie Callaway (CFO and Director): 118,110 Jakob Sigurdsson (Independent Director): 47,244; Fran Philip (ID): 25,984; Nicholas Bull (ID): 50,000; Hongyan Lu (ID): 7,874. The positive from this is that all directors showed faith in the company and its future. The negative, which I am sure will grate with UK-based investors, is that insiders had an opportunity that many other, UK-based, retail investors seem not to have had. On 13 August there was a notification that Blackrock --one of the world's largest institutional investors-had increased its shareholding from 5.0% to 5.6%. It is not entirely clear if this was via a UK-based entity or an off-shore entity. I infer that the additional shares were purchased in the market and not through the capital raising. Looking ahead, I agree completely with EI's recent posting. The shares do indeed look cheap, but it will not be until we get the full year results for 2024 that we will know how well the Board and Management can deliver the forecast earnings. |
Posted at 11/8/2022 17:55 by manurere I believe it was 63.5p. As a non-UK investor, I wasn’t eligible. It was basically an insiders’ deal as far as retail investors were concerned. But I am not overly annoyed. It raised capital quickly and efficiently. The company is expanding I expect the benefits to show through in share price and dividends.The share price is already above the issue price and will probably move back into the 70p zone fairly soon. I think we retail investors just have to suck up this one. Yes, we got stiffed a bit. But we need to take a broader view. |
Posted at 22/7/2022 18:24 by cravencottage Here's what the I/C had to say in back in April..Coats is back in fashion The industrial thread company’s growth is sustainable in more ways than one April 7, 2022 By Jemma Slingo Those in search of threads, yarns and trims might visit a local haberdashery. The idea feels quaint in 2022, where sewing has largely been replaced by shopping. There is nothing quaint about thread manufacturing, however. The lucrative industry literally holds together swathes of the retail sector, and promises to be a reliable source of returns for investors. IC TIP: Buy Tip style GROWTH Risk rating MEDIUM Timescale MEDIUM TERM Bull points Convincing growth opportunities Large market share $50mn cost-saving drive More demand for sustainable thread Bear points Tight US labour market Inflationary pressures Uxbridge-headquarter Its smaller ‘performance materials’ arm – which produces thread for an eclectic range of purposes, including personal protection, telecoms, and transportation – also has a chunky market share of around 14 per cent. COA:LSE Coats Group PLC 1mth Today change 3.30%Price (GBP) 72.10 Coats’ size and history is crucial to its investment case. The group has been around since 1755, boasts well-established manufacturing processes, and counts on long-standing customer relationships, meaning new entrants to the market are unlikely to prove a threat. Its broad portfolio also shelters it from the volatility of fashion retail. Its apparel and footwear division targets a variety of markets including premium lifestyle, fast fashion, mid-market, and luxury attire. Because of this, fickle consumer taste – often the downfall of retail brands – has little impact on demand for its products. But it hasn’t all been plain sailing. Coats had a difficult lockdown, when profits were hit by a drop in demand and additional coronavirus costs. However, the group bounced back well in 2021, when sales and cash exceeded pre-pandemic levels, and operating profit edged toward past highs. Momentum also seems to be building. The final two months of 2021 saw sales up 20 per cent versus 2019 in both divisions, compared with 1 per cent in the first half of the year. Opportunities in Asia Over the past decade, Coats’ customer base has shifted away from Europe and into Asia. Asian countries – particularly India and China – are now expected to drive sales. In its latest annual report, the group said that sewing thread markets are due to grow by low single-digit percentages globally in the medium term. However, growth in Asia is expected to be faster, as consumers become wealthier and urbanisation increases demand for products such as fibre optic cables, which Coats’ performance materials division also specialises in. “Not only will Asian consumers demand more garments, but more affluent consumers will demand higher-end garments, so we expect regional sales from our factories in Asia to increase over time,” management said in 2020. Vietnam is also an important player. The country is a key end market for Coats as many of its clients have factories there. A series of strict Covid lockdowns resulted in serious operational disruption, particularly in 2021, when Coats had to temporarily shut its Vietnam site. The situation seems to have improved since then, although other shut-downs in Asia cannot be ruled out. Sustainable sewing Geography is not the only thing working in Coats’ favour. The group is also tapping into sustainability trends. As flagged in our recent Alpha report on the company, the apparel and footwear industry is a major polluter and retailers are under pressure to go green. Historically, synthetic threads have been an oil byproduct, so eco alternatives are likely to have a competitive advantage. At the moment, this side of Coats’ business is small. Its ‘EcoVerde̵ The group has also repurposed its Asian ‘innovation hub’ to focus on new biomaterials, and launched a new product in 2021 made from sustainably sourced wood pulp. As well as ticking the ESG box, this is an exciting opportunity to grow margins and market share. Analysts at Jefferies say Coats’ focus on sustainability is “core to [its] positive thesis”, and believe it will help to raise higher absolute profit per unit. Efficiency drive It might sound unduly optimistic to discuss margin improvements against a backdrop of inflation, tight labour markets and supply chain chaos. Coats is far from immune from these pressures, as the decline in its PM division’s operating margins since 2019 shows. This is largely due to its US operations, which are dogged by worker shortages and rising wages. Management seems to have a plan, however. In early March, Coats announced a cost-saving scheme which promises to deliver incremental adjusted operating profit of $50mn by 2024. How exactly it will achieve this is a little hazy – the group refers simply to “strategic projects” that will optimise the business’s portfolio and footprint. However, broker Peel Hunt suspects Coats will focus on performance materials and – in a move straight out of the modern manufacturer’s playbook – increase production from lower-cost locations, such as Mexico or further afield. This does not come without its own risks. Part of the strength of Coats’ business model is its global footprint, and the flexibility of its supply chain. Many of the group’s performance materials customers are based in the US, which has so far prevented significant offshoring. It is hard to shake the sense, therefore, that management’s hand has been forced. However, analysts are excited by the cost-saving possibilities. While the efficiency drive is expected to incur a one-off cash cost of $35mn, Jefferies expects it to boost consensus earnings before interest, tax, depreciation and amortisation by 9 per cent in 2023 and 2024, and result in margin accretion of two percentage points. Decent valuation For some investors, a question mark hangs over the profits that will flow to shareholders. The shares have jumped by around a third since the end of February, driven by a strong set of annual results. But the stock sits on less than 13 times forward consensus earnings, and sentiment still remains tainted by historic issues with its group pension arrangements. While the words ‘defined benefit scheme’ often cause investors to break out in a cold sweat, in the case of Coats things aren’t too bad. The group moved from a deficit of $226mn to a surplus of $21mn in 2021, largely due to higher discount rates and employer contributions. Future contributions will remain at the previously agreed level of £22mn a year, meaning that the deficit should be paid down by 2028. These contributions will inevitably impact Coats’ cash position. However, the end is well in sight and the group generated an impressive amount of cash in 2021, despite having to catch up on some payments it deferred at the start of the pandemic. As such, it managed to reduce its net debt (excluding lease liabilities) by almost $35mn, and increase its dividend. Coats seems to offer an attractive combination of value and growth, therefore – and its performance this year suggests that industrial thread is firmly back in fashion. 2021 1.50 160 6.81 1.44 f'cst 2022 1.56 186 7.70 1.64 f'cst 2023 1.63 210 8.81 1.84 chg (%) +4 +13 +14 +12 |
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