Costain Share Discussion Threads

[catabrit] 10/1/2024 10:00

Also, I still think this has Rolls Royce potential when it comes to the re-rate. Obviously different situations and market caps but there is so much upside here if the underlying biz performs as it should and the old perception issues wilt away.

[catabrit] 10/1/2024 09:52

I think a few of you need to go and check your facts. Consultancy is a meaningful piece of the pie. Until that is proven otherwise - and the percentages are either given or alluded to in the annual report - this is a big contractor with a big consultancy arm and that’s that.

[eigthwonder] 10/1/2024 09:44

'tis the way of it in this sector, although the rating is mean by sector standards. The blueprint for COST shares should be GFRD - prove you have stabilised the business, then generate a track record period by period. I would be cautious on "consultancy" - it was a label which the previous CEO used to try and attach to the company but the reality was that true consultancy was minuscule and much of the rest was nearer to hatching up proposals for contracting business.

[xamf] 10/1/2024 09:05

It's incredible that the company is valued at close to their net cash position.

[roguemale1] 10/1/2024 08:51

hxxps://www.constructionenquirer.com/2024/01/10/costain-boosts-year-end-cash-a-third-to-164m/

[muckshifter] 10/1/2024 08:43

Nice update. The positive working capital timings contributing £25m cash might mean that their future workload was running down a little, but todays news about Northumbria should put that right, hopefully. The lack of any major contract announcements recently had me thinking that much of their workload must now be coming from framework agreements such as this one, which is very good news in terms of the risk / profit ratio, imo.

[this_is_me] 10/1/2024 08:24

Costain has ended 2023 with a net cash position of GBP164.4m

Market cap still only £173 million.

I'm already up over 50% in just over a year. Plenty more to come over the next couple of years.

[roguemale1] 10/1/2024 08:05

Long auction......

[pinemartin9] 10/1/2024 07:57

Under promise over deliver...this could rocket in 2024.

[catabrit] 10/1/2024 07:57

Amazing start to the day. Can someone please turn the light on so that the rest of the market can see what I and a few others do? That is a mega step up in net cash and a mega contract win. Expecting a mea culpa from Chris Magpie today!

[mirabeau] 10/1/2024 07:38

'net cash position of GBP164.4m (2022 year-end: GBP123.8m), significantly higher than market expectations of GBP128.6m.'

And the business for nowt...amazing

[roguemale1] 10/1/2024 07:25

Best chuck some of that cash our way then!

[ttny2004] 10/1/2024 07:17

Costain Group PLC AMP8 Water Framework Win with NWG & Trading Update10 January 2024 RNSCostain AMP8 Framework Agreement with Northumbrian Water Group and Trading UpdateAppointment adds to Costain's wins in the new water regulatory cycleCostain Group PLC ("Costain", or the "Company") announces that it has been appointed by Northumbrian Water Group (NWG) to shape, create and deliver its strategic infrastructure upgrade programme. The framework will see contracts awarded with a potential value of up to GBP670m to Costain during a 12-year period and builds on recent significant wins in the water sector for the Company.The framework contract will see Costain work with NWG and its partners to shape, create and deliver solutions to meet the strategic needs of its business plan during Asset Management Period 8 (AMP8). The contract starts immediately and will run for a seven-year initial term with an option for a five-year extension.AMP8 will see the biggest investment in the water industry for decades. In 2023, Costain extended into AMP8 its Managed Service Provider contract with United Utilities and its consultancy work with Yorkshire Water. Costain has also won funding from Ofwat to support innovation projects.Trading UpdateCostain has had a positive trading year in 2023 and expects to deliver adjusted operating profit in line with market expectations. As a result, and reflecting an increase in financial income compared to 2022 and strong working capital management, together with the accumulation of GBP25.0m of positive working capital timings, Costain has ended 2023 with a net cash position of GBP164.4m (2022 year-end: GBP123.8m), significantly higher than market expectations of GBP128.6m.."We are also pleased to report that we have had a positive trading year and expect to deliver adjusted operating profit in line with market expectations. Our cash performance has been very strong, driven by continued improved operational performance, an increase in financial income compared to 2022, and ongoing positive working capital timings."Costain will issue its results for the financial year 2023 on 12 March 2024.

[chris magpie] 08/1/2024 19:08

Well don't think they have won a really decent size job for over a year.

[roguemale1] 08/1/2024 10:20

HNY all.
FYI
Some may have seen the Construction Enquirer Work won top 100 listing for 2023 published last week.
Costain are not on it. According to IR it's an error... Turnover is as per FY and HY updates blah blah.

[catabrit] 29/12/2023 08:35

Concur with rogue. It will never become full consultancy. The complex delivery provides decent profits in £ terms. You just have to manage risk properly like the guys do over at Morgan Sindall.

Also it might not be a meme stock - not that any of us would want it to become one? - but let’s not forget that Costain is one of the largest and oldest civil engineering firms in the U.K. with over 120,000 followers on LinkedIn.

It is hardly insignificant. And the more market cap we gain, the more liquid it becomes etc.

[roguemale1] 29/12/2023 08:12

I don't think it can ever be mainly consultancy? That just provides a %age of turnover with an enhanced margin which sweetens up the high turnover at low margin traditional contracting. I don't think he's ever laid out a picture of what the turnover split might look like? AT the moment that trad turnover is OK as far as I can ascertain so am expecting decent solid results. Some of HS2 dollar should start showing up also which should help...some crazy stuff going on there.
Roll on FY!

[thags] 28/12/2023 18:46

It all depends on whether they can survive on a mainly consultancy basis or not. This is no meme stock with very little interest so the numbers are everything here, no BTC type speculation happening here just results

[ttny2004] 28/12/2023 18:29

Looking for over 100p for starters by end of 2024.

[ttny2004] 28/12/2023 18:27

My reasons why I continue to hold and still think we will see a substantial share price rerating in 2024.1. If we compare Costain to industry peers it has a P/E Ratio of 7.9 whereas its industry sector average is 13.3. Nearly double. Keller 10.3 and Galliford even 23.2. Fair value would equate to 1.18 which shows we are over 47% undervalued. Looking at future cash flow forecasts using DCF models.3. Hope greater broker analysts coverage in 2024 which should give a more significant rerating.

[pinemartin9] 28/12/2023 18:18

Very encouraging move today

[catabrit] 28/12/2023 17:50

We are bubbling nicely and it feels like it is just a matter of time before the cork pops. We will see. But a great way to cap off 2023.

[xamf] 28/12/2023 09:11

It would appear that the once strong resistance level of 60p is now providing an equally strong support level. Low PE, PB but most importantly no debt. Hoping for a rebound here (and the general sector) in 2024 as inflation settles.

[pinemartin9] 25/12/2023 13:54

Happy Christmas one and all!

[catabrit] 21/12/2023 11:27

Not sure it matters over the medium to long term, Cash. These will perform in the same way as other recovery stocks such as Rolls Royce. We have a lot of enterprise value to gain.

Oh and if you check consensus, the sell side is still quite cautious on the margin potential. So if Costain hits target, we’re going to see some big upgrades in 2024 and 2025.