The market is clearly unimpressed. Let's hope things buck up in the new year. Happy Christmas, Roddie. Not feeling too jolly myself. |
Our Haven,
they show the price paid for Mimic and the UK operations of Strainstall as £ 13.6m plus a performance related payment of £ 3,9m but they don`t show how much was paid for Prolec . ----I phoned the Co. and left a message requesting clarification |
I must be reading the sale of the three businesses as I can only see the price paid for the two UK companies. |
 Motley Fool's FSJ share tip.
By Gabriel McKeown. It used to be tricky to find high-quality companies with low market capitalisation; however, the recent market turmoil has meant that there are now far more small-cap opportunities for UK investors. A prime example of this is Fisher James & Sons (LSE: FSJ), as the share price has fallen almost 85% from pre-pandemic levels.
Despite this share-price decline, the company’s earnings are forecast to grow considerably, signalling a rebound may be on the horizon. Earnings per share is expected to grow by over 40%, compared to 3% turnover growth, indicating that profit margins should improve. Additionally, free cash generation remains strong and is now above its three-year average level.
The company’s significant debt level has likely caused investors to avoid this opportunity. However, the interest cover ratio of 2.1 indicates that this can be covered comfortably by earnings. This financial stability is certainly encouraging, especially if market conditions continue to weaken. |
What NAV (Net Asset Value) do you have for both?
James Fisher:
NAV of £210m for FSJ
(market cap £156m)
P/B (price to book) ratio is 0.74
Ashtead Technology:
NAV of £61m for AT.
(market cap £244m).
P/B (price to book) ratio is 4
Therefore FSJ has a P/B which is better than AT. by a factor of 5.4x
For FSJ to have the same P/B ratio as AT. (ie 4), FSJ market cap would need to be £831m, with a share price of 1682p.
That's where it was in March 2020, having come down from 2100p at the start of that year.
Whilst those are only one or two indicators, it shows value is where you find it. GLA. |
Bottomfisher - oooops!
finger trouble.
Tou are quite right I wrote down the (adj) eps figures for FSJ rather than the PE!!
No wonder I was quite surprised! More haste less speed.
FSJ
FY21 (adj) eps 57.2p
FY21 PE 5.3x
Forecasts
FY22 (adj) eps 26.4p
FY22 PE 11.6x
FY23 (adj) eps 44.5
FY23 PE 6.85x
Not long to wait now before we find out whether FSJ will hit these (much reduced) forecasts.
cheers |
Many thanks Illiswilgig for your thoughts on the difference between FSJ and Ashstead Technology. I am a shareholder in both companies, although my heart lies with Fisher (not the best investment test I know). Agree with your point about the problem of FSJ’s large net debt relative to its market cap although a bit less clear about the profit comparisons. According to the Stockopedia figures (not always reliable) FSJ is trading on a p/e of 11.6 times current year’s earnings falling to 6.85 times in 2023, compared with 18 times for Ashstead's 2022 earnings which falls to 15.7 times for 2023. (Both companies have December year ends).
Ashstead’s performance to date look good and it has attracted an impressive list of institutional shareholders. But its appetite for acquisitions makes me a tad nervous, as was the recent placing by its biggest shareholder only days after a bullish write-up by Simon Thompson, the Investor Chronicle’s top share tipster. |
'Any thoughts on why there is such a difference in the relative share price performance of the two companies?'
I'll have a go. One word.
Debt.
Two words.
Debt and Profits.
Ashtead debt is small relative to market cap 10% Fisher debt is large relative to marketcap > 100%
Ashtead profit forecasts have been rising whereas Fisher profit forecasts have been falling.
Slightly longer comparison.
AT.
Mcap 240m
net debt 22m
revenue (historic) 56m
FSJ
Mcap 154m
net debt 205m
revenue (historic) 499m
Ashtead Technologies is a global subsea equipment rental business. More than likely that James Fisher is a customer of Ashtead.
AT has been growing faster than FSJ in recent years 14% annually over the last 5 years. Whereas FSJ turnover has gone backwards. Slightly.
AT is highly rated (for a bear market) at 54x historic profits and 18x forecast profits for FY22.
FSJ is rated at 57x (historic) profits and 26x (adj) forecast for FY22.
Arguably FSJ is current;y more highly rated than Ashtead?
Rental businesses have been doing well through the last couple of years. James fisher rental business in its offshore business has been its most profitable in this period.
Ashstead has to keep growing fast to justify its current high share price - even faster for the share price to grow.
FSJ has to succeed in its turnaround to justify its current share price and it can rise substantially IF it can fix its problems, return to growth and pay down debt.
At the moment with interest rates on the rise - FSJ share price has been held back by lack of news on recovery and the perception of cashflow being diverted into rising interest payments instead of paying down debt and investing in growth.
Fisher looks the higher reward but is clearly higher risk until there is news on current cashflow and debt.
I couldn't resist it - bought a few more FSJ at recent lows
cheers |
The share price here climbed strongly from 290p area to 2100p area between 2009 and start of 2020 (covid).
This is not a share which was in decline before covid. |
That's a bit better! |
The recently floated Ashstead Tecnology (AT), the sub-sea technology service provider, goes from strength whilst James Fisher (FSJ) struggles. Both companies operate in different areas of similar markets. Any thoughts on why there is such a difference in the relative share price performance of the two companies? |
Who's got a tick, a down tick that is. Yawn, let's see where this is in 18 months then. |
18 months this will be 1000p IMO. |
Just hold for a couple of years and it'll be back to over 1000p IMO.
Patience is the hardest thing ;) |
The possibility of all those new contracts and a re- rating of the share are my guesses, but beyond that I have no insight bouleversee. |
Excellent indeed! What prompted the rise? |
Excellent day. Re-rating was overdue IMO |
It is fairly thinly traded, if you lower your order size it usually gets filled.
Still keeping an eye out for contract wins or disposals here. Price has drifted down last few weeks.
Noticed in the new today that France and Spain are going ahead with building an undersea energy network - this type of work would be great if they can get it. |
Wont let me trade here |
That must be why the share price has shot up this morning. LOL. |
Does FSJ do sub sea pipeline repairs, bit of work about at the moment. |
We'll if Liz Truss gets her way with increasing North Sea oil and gas that's surely a good sign for FSJ...! |
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