Coats Share Discussion Threads

[philanderer] 06/8/2021 09:18

Coats is mispriced, says Berenberg


Coats (COA), the world’s largest manufacturer of sewing thread and supplies, remains a ‘mispriced equity’, says Berenberg.

Analyst Anthony Plom reiterated his ‘buy’ recommendation and increased the target price from 80p to 85p on the stock, which closed up 0.9%, or 0.6p, at 71.5p on Thursday.

‘Recent trading shows a V-shaped recovery, earnings per share momentum is strong, margins are trending back to the mid-teens, and there is a very credible sustainability story emerging,’ he said.

The stock trades at a ‘significant discount to peers’ on a 14x 2022 price/earnings ratio and free cashflow yield of 4.7%.

‘We believe both the rating and earnings can move higher, so investors should not be deterred by the recent share price run,’ said Plom.

[undervaluedassets] 03/8/2021 10:41

Well I do not think anyone expected that..

Revenues and cash generation beat 2020 (of course given pandemic) but more interestingly bested those of 2019.

The median share price in 2019 was 85p. To my mind 100p looks fairly rational target given results modestly bested those of 2019.

The company is the world leader in thread manufacture and is sounding confident.

pays a divi too.

[our haven] 03/8/2021 09:09

Half year results look good. The momentum is back travelling in the right direction with some good contract wins. India back out of lockdown and H2 looking very positive. Cash much improved.

[american idiot] 15/7/2021 08:40

From yesterdays results...

Shares of industrial thread manufacturer rise as much as 3.09% to 69.9p, highest since Jan. 6
* Stock is biggest pct gainer on U.K. mid-cap index
* Co says HY group sales rose 36.5% to $732 mln, for six months to June 30
* H1 adj. operating profit to be ~$95 mln vs $34 mln a year earlier - COA
* Says strong performance and demand recovery have continued, despite recent lockdown impacts in India...
* Performance for FY 2021 is now anticipated to be moderately ahead of our previous expectations - COA
* Peel Hunt raises COA PT to 85p from 80p
* "COA will emerge from the pandemic with an accelerating sales performance driven by digitisation, new product development and sustainability" - Peel Hunt

..............

Coats are clearly performing very very well...

[manurere] 15/7/2021 01:51

Latest update much better than I or, it seems, other investors had anticipated. Coats is emerging very quickly from the Covid crisis much stronger than any of us had hoped. The update underlines, once again, how well the current Board and management have built a very sound platform for the future.
If one wants to be invested in manufacturing, then this appears to be a very solid option.

[manurere] 15/7/2021 01:51

Latest update much better than I or, it seems, other investors had anticipated. Coats is emerging very quickly from the Covid crisis much stronger than any of us had hoped. The update underlines, once again, how well the current Board and management have built a very sound platform for the future.
If one wants to be invested in manufacturing, then this appears to be a very solid option.

[our haven] 14/7/2021 07:12

Great update given the shutdown in India. Should see the price react positively to this update.

[manurere] 04/7/2021 05:27

While movement is not great, there seems to be quite a lot of buyers at around 68 pence.

I subscribe to analysts who provide a very detailed breakdown of global shares. They assess the value of Coats at around 145 pence; that's well above most broker forecasts. But brokers are picking short-term price movements; they are not assessing fair value.

As a very deliberate, long-term investor in Coats, my principal concern is the prospect of a low ball offer. If some smart buyer comes in with a bid of around 88 pence--a 30+% margin over the current price--then there will be heaps of shareholders who will happily take the money and run. The buyer will walk away with a medium term gold mine, while investors like myself will feel cheated.

The key to this company in the medium term is the performance of its industrial division. Technologically advanced threads that can be used in PPE, cable casings, high performance sportswear, etc. Thats where the medium- long term money is. And that's where Coats seems to be light years ahead of the pack.

There will be ups and downs along the way. But a share price around 145 to 150 pence and dividends around 7 to 8 US cents a year. That's where this company is probably heading.

[scooper72] 01/7/2021 14:23

Interims 3rd August. Deciding to hang around until then and see what the progress is. Not a lot of momentum in the share price at the moment. One of these holdings where one requires a lot of patience.

[skyship] 20/5/2021 06:41

Sp breaks through the downtrend and above the SMAs. Target - the December level of 73p. Could be a good trade...


free stock charts from uk.advfn.com

[undervaluedassets] 20/5/2021 06:10

It is a "re-opening" stock.

You cannot make much of anything without thread.

Price setting business rather than price taking business so well positioned for the inflationary environment.

I like how boring this business is too. Thread. Currently 'boring' old economy is where everyone wants to be.

[skyship] 19/5/2021 08:11

Chartists may be in for a few too as COA breaks its downtrend - target?..Yes, that 70p level.

[essentialinvestor] 19/5/2021 07:45

Could not ask for much better than that.

[our haven] 19/5/2021 07:23

Agree American with your comments.Back to 70p, but knowing Coats it will probably be by slow creep.

[american idiot] 19/5/2021 06:46

Excellent trade update this morning....

Onwards back towards 70p+


Organic group sales for the period grew 26% year-on-year (1% versus 2019).



In Apparel and Footwear we saw improving momentum and recovery (up 30% versus 2020 and flat versus 2019). Robust volume growth resulted in increased factory activity. Against 2019 the core thread business (which represents c.85% of Apparel and Footwear) grew solidly (up 2%). Key markets performed well vs 2019, albeit zips are recovering at a slower pace.



Performance Materials was up 14% versus 2020 and 4% versus 2019, with all segments performing well and growing against 2019 and 2020, with the exception of Personal Protection. Personal Protection continues to be impacted by labour availability issues, specifically in the US Yarns business.



Pricing and productivity actions are being successfully implemented to offset inflationary pressures (raw materials, labour and freight inflation) in the supply chain.



In April we announced the completion of a three year $360 million ESG-linked bank refinancing (with the ability for two one-year extensions). Our committed debt facilities total $585 million across our Banking and US Private Placement group, with a range of maturities from 2024 through to 2027, and we currently have around $350 million of committed headroom against these banking facilities. As at 30 April 2021 our net debt (excluding IFRS16) was $162 million (31 December 2020 $181 million).

[ptolemy] 18/5/2021 10:51

AGM tomorrow.

[essentialinvestor] 07/5/2021 16:23

Creasing! - very nice day.

The Yass reference for those who may be unaware is the track 'The Only Way is Up'.

[essentialinvestor] 07/5/2021 08:54

Lovely)).

Recent divi as well.

[ttg100] 07/5/2021 07:50

if it goes back through 60 convincingly then i will buy some

[essentialinvestor] 05/5/2021 13:37

Was hoping for a push on to the mid 60's, which is clearly not happening atm.

Trading update 18 May - this is an important one.

India Covid situation may be weighing on the SP,
as Coats has multiple manufacturing facilities in India.

Logistics costs another potential headwind, that like Covid-19 disruption, is hopefully temporary
and will resolve.


Medium term industry trends Should be highly supportive and play right to Coats' strengths -
unless I'm misreading this.

[essentialinvestor] 29/4/2021 08:25

Trading XD - 0.90 pence approx.

[spittingbarrel] 23/4/2021 14:04

I've joined you.

[essentialinvestor] 23/4/2021 13:32

Added 35k.


Can't may any comment on TA, but would hope for a move back to mid 65/66 pence type area.


On fundamentals, the increasing focus on sustainability for apparel should play
right in to COATS' hands, as they are arguably ahead of the wider industry on this.
Market share gains have been recently referenced.

Apart from apparel COA has a growing market in protective clothing and wider industrial applications
such as telecommunications etc - often overlooked in media company commentary.

[ptolemy] 23/4/2021 13:22

Chart looks great to me. See: