GKN Share Discussion Threads

[valedo] 27/2/2013 09:18

GKN's fourth and smallest division, producing parts for agricultural and industrial vehicles, recorded a 23 per cent leap in profits.

"The key message is that the underlying performance of the business is solid and that the growth trajectory remains positive," Andrew Gollan, an industry analyst at Investec, said.

UBS said that GKN was undervalued compared with its automotive and aerospace industry peers.
times.

[thorpematt] 26/2/2013 18:51

Extraordinary.

I left home this morning having read the results and shaking my head at the market's interpretation once again. Frankly I've failed to understand Mr. Market on this one for so long now I've got to the point of past caring.

(Like PHIL0124) I have held confidently for some time and continue to do so. I honestly believe these should be about £4 on any sensible analysis.

This evening I arrive home to find that perhaps the penny has dropped where Mr.Market is concerned.. we'll see.

[philo124] 26/2/2013 17:57

Good. I still hold confidently despite my broker's early morning doubts.

[broadwood] 26/2/2013 14:22

Nothing not to like then.

ngineering group GKN will have a challenging start to 2013 but has a sound platform for solid growth, according to Jefferies which kept its 'buy' recommendation and 275p target price for the stock.

2012 results reported Tuesday morning came in better than Jefferies' forecasts across the board: group management sales of £6.90bn were ahead of the £6.88bn estimate, while profit before tax (PBT) of £497m was above the £486m prediction.

Jefferies hailed the company's fourth-quarter performance in particular, with Aerospace sales helped by a bigger-than-expected contribution from the Volvo Aero acquisition and a better-than-forecast performance in Driveline. "In 4Q12, we believe all divisions demonstrated encouraging organic growth and satisfactory returns."

As for 2013, the broker acknowledged that expectations still vary widely with company-sourced data showing an estimated sales range of £7.11bn to £7.82bn (Jefferies: £7.44bn) and underlying PBT forecasts ranging from £518m to £605m (Jefferies: £518m).

Jefferies said that this year will see a "challenging start" but the trading backdrop will become more benign, perhaps even positive in the second half - "GKN's progress appears poised to accelerate when the latter occurs".

"In 2013, GKN will have to take the rough with the smooth. We envisage most of the rough in 1H13 and the smooth(er) part in 2H13," Jefferies said.

"There is a sound platform for good future growth, in our view. Against a stable demand backdrop, GKN should make very strong progress, in our view

[daz] 26/2/2013 13:51

Quite a turn around today, I suspect that the analysts meeting has gone down well and that probably reflects the integration benefits from the Volvo aero deal.

[penpont] 26/2/2013 12:59

Jefferies kept its 'buy' recommendation and 275p target price for engineering group GKN (LSE: GKN.L - news) after its 2012 results came in better than forecasts across the board.

"There is a sound platform for good future growth, in our view. Against a stable demand backdrop, GKN should make very strong progress, in our view."

[okw] 26/2/2013 07:42

Dividend

In view of the improving trading performance and taking into account the Group's future prospects, the Board has decided to recommend a final dividend of 4.8 pence per share (2011: 4.0 pence).

The total dividend for the year will, therefore, be 7.2 pence (2011: 6.0 pence). The Group's objective is to have a progressive dividend policy reflecting growth in earnings per share and free cash flow generation, including the pension deficit funding.

The final dividend is payable on 20 May 2013 to shareholders on the register at 12 April 2013.

[broadwood] 26/2/2013 07:23

- Spaecialist engineering group GKN said its results for the year to end-December reflect the continued strong organic growth and the contribution from acquisitions, with record profits achieved in all four divisions.

· Sales increased 13%, up 6% on an organic basis

· Management trading (operating) profit up 19%

· Trading margin improved to 8.1%

· Profit before tax up 19%

· Return on average invested capital of 18.1% (excluding Volvo Aero)

· Earnings per share up 17%

· Final dividend of 4.8 pence per share, giving a total for 2012 of 7.2 pence per share, a 20% increase

· Reported profit before tax of £588 million (2011: £351 million)

· Positive free cash flow of £213 million (2011: £147 million), excluding Volvo Aero

· Net debt of £871 million (2011: £538 million), reflecting the acquisition of Volvo Aero.

Nigel Stein, CEO, said: '2012 was another strong year for GKN with record profits in all four divisions. The Group has continued to make good progress financially and in implementing our strategy to build a market-leading global business, with excellent technology, a focus on operational excellence and above-market growth.

'GKN operates in global markets and has the capabilities needed to take advantage of the growth opportunities that those markets bring. With the benefit of a full year contribution from Volvo Aero, we expect 2013 to be a year of good progress for the Group.'

[philo124] 26/2/2013 07:17

Results look ok, bad mkt day to bring out results.

[okw] 26/2/2013 07:16

Group Highlights(1)

• Group results reflect the continued strong organic growth and the contribution from
acquisitions
• Record profits achieved in all four divisions
• Sales increased 13%, up 6% on an organic basis
• Management trading (operating) profit up 19%
• Trading margin improved to 8.1%
• Profit before tax up 19%
• Return on average invested capital of 18.1% (excluding Volvo Aero)
• Earnings per share up 17%
• Final dividend of 4.8 pence per share, giving a total for 2012 of 7.2 pence per share, a 20%
increase
• Reported profit before tax of £588 million (2011: £351 million)
• Positive free cash flow of £213 million (2011: £147 million), excluding Volvo Aero
• Net debt of £871 million (2011: £538 million), reflecting the acquisition of Volvo Aero.

"2012 was another strong year for GKN with record profits in all four divisions. The Group has
continued to make good progress financially and in implementing our strategy to build a market-
leading global business, with excellent technology, a focus on operational excellence and above-
market growth.

GKN operates in global markets and has the capabilities needed to take advantage of the growth
opportunities that those markets bring. With the benefit of a full year contribution from Volvo Aero,
we expect 2013 to be a year of good progress for the Group."

[broadwood] 26/2/2013 07:15

Satisfactory, I think, - will this be enough?


'GKN expects 2013 overall to be a year of good progress for the Group'.

[broadwood] 25/2/2013 16:31

Engineering heavyweight GKN is expected to record a 14.8 per cent rise in revenues when it releases its annual results Tuesday.

Revenues are expected to reach £6.6bn for 2012, compared to £5.7bn posted the previous year.

Shares jumped a day ahead of the results but Nomura has advised investors to remain cautious following a decline in Europe car sales.

"Although we are in-line with consensus for fiscal year 2012 and weakness in European auto demand has been well-flagged previously, the share price momentum is a slight concern to us, as car sales in Europe declined a further 9.0% year-on-year in January of this year, which we think will prompt a cautious outlook by GKN's management," Nomura analyst Juho Lahdenpera warned in a report released late last week.

"We take a cautious view on the shares heading into the numbers."

Nomura will be focusing on the management's outlook, particularly on how they intend to offset a possible further fall in European demand on Driveline's and Powder Metallurgy's margins.

January car sales in Europe dropped 9.0% year-on-year to all-time lows and the analyst anticipates total regional auto production to decline 4.0% for the fiscal year 2013, compared to the previous year's 2.0% year-on-year decline.

"In addition, the progress of restructuring in Aerospace to integrate Volvo is of interest to us," Nomura added.

"Consensus, like us, looks to give management full credit for its integration plans and any delays would be a downside risk to estimates. The ongoing safety reviews on Boeing's Dreamliner aeroplane are unlikely to have impacted Aerospace production to date, as we understand that Boeing has asked GKN to maintain production rates."

[philo124] 25/2/2013 08:56

Results tomorrow. SNR results today were strong.

[thorpematt] 20/2/2013 16:51

Look at the 5 year chart.

There's nothing to stop this for a while yet.
Fundamentals say this is very cheap in the context of such a large company.

Fall in the pound sends a further tail-wind for exporters.

Brokers targets surely going to 320p in due course...

[philo124] 20/2/2013 10:15

Nearly there.

[mechanical trader] 12/2/2013 10:42

12 Feb GKN PLC GKN Investec Buy 252.95 257.90 275.00 275.00 Reiterates

SP Target 275p.

[philo124] 10/2/2013 19:41

Just looked again at eps forecasts on Digital Look. I think with the eps growth
and the Divi % that 300p wouldn't be expensive.

[broadwood] 08/2/2013 15:11

So it must be this.



LONDON - 1458: Global engineering giant GKN (up 3.54 per cent) is among the top performers on the FTSE 100 after the state-backed China Association of Automobile Manufacturers reported that passenger-vehicle sales in the country jumped a better-than-expected 49 per cent year-on-year to 1.73m units last
month.

[broadwood] 08/2/2013 15:07

I see there was an IMS on 18 April last year.

Can't see any scheduled announcements before then

[mechanical trader] 08/2/2013 14:57

This looks like the real thing
this time a true breakout after
what 6 or so attempts.

Usualy get dynamic moves up afterwards
as latent supply above the range as
been drawn into the range due to holders getting
impatient and then leaving share price ranges above
the original resistance threadbare and easily
to navigate through with reasonable demand
ie buyers.

CHOCKS AWAY.......................

[mechanical trader] 08/2/2013 14:57

This looks like the real thing
this time a true breakout after
what 6 or so attempts.

Usualy get dynamic moves up afterwards
as latent supply above the range as
been drawn into the range due to holders getting
impatient and then leaving share price ranges above
the original resistance threadbare and easily
to navigate through with reasonable demand
ie buyers.

CHOCKS AWAY.......................

[mida5] 08/2/2013 09:20

Will we get through 250 in the short term?

[mechanical trader] 06/2/2013 10:00

Brokers like GKN.......

GKN Broker Views

Date Broker Recommendation Price Old target price New target price Notes

05 Feb Investec Buy 248.75 275.00 275.00 Reiterates
01 Feb Oriel Securities Buy 248.75 300.00 - Reiterates
29 Jan Citigroup Buy 248.75 290.00 290.00 Reiterates
17 Jan Credit Suisse Outperform 248.75 255.00 255.00 Reiterates
17 Jan Oriel Securities Buy 248.75 300.00 300.00 Reiterates

N@P Building Society.