Hangar 8 Share Discussion Threads

[rivaldo] 03/12/2013 08:44

Agreed El1te.

And now Seymour Pierce have increased their target price to 260p, saying Buy:



"Hangar 8 PLC PT Raised to GBX 260 at Seymour Pierce (HGR8)

Posted by Logan Wallace on Dec 2nd, 2013 // No Comments

Hangar 8 PLC logoResearch analysts at Seymour Pierce increased their target price on shares of Hangar 8 PLC (LON:HGR8) from GBX 240 ($3.93) to GBX 260 ($4.26) in a report released on Monday, ARN reports. The firm currently has a "buy" rating on the stock. Seymour Pierce's price target suggests a potential upside of 15.08% from the company's current price.

A number of other firms have also recently commented on HGR8. Analysts at Cantor Fitzgerald raised their price target on shares of Hangar 8 PLC from GBX 240 ($3.93) to GBX 260 ($4.26) in a research note to investors on Monday. They now have a "buy" rating on the stock. Analysts at Westhouse Securities initiated coverage on shares of Hangar 8 PLC in a research note to investors on Friday. They set a "buy" rating and a GBX 270 ($4.42) price target on the stock."

[el1te] 03/12/2013 08:01

RNS out. Dustin sold 750k shares to satisfy institutional demand. Not sure whether the shares were sold into the market or directly to an institution. If it's the latter, a holdings RNS should emerge

That is exactly what I wanted to see though. That should unlock some liquidity and help the share price in the long run.

Good stuff - bit gutted I didn't put them as a buy now :). GL to investors nonetheless

[rivaldo] 02/12/2013 11:53

Cheers paleje. HGR8 is certainly getting a little attention now...

And apparently Cantor's have today increased their target price to 260p from 240p (saying Buy of course).

IMO HGR8 is worth 300p+ at present given the growth, the economic cycle, the visibility of revenues etc, but no doubt the brokers will get there at some point.

[paleje] 02/12/2013 10:02

Citywire featured them this morning, only repeating the Westhouse view but the point is when Citywire feature a co you know its getting insti attention, good or bad.



Rivaldo, that IC article was only short, positive though:-

(HGR8) expensive jet aircraft, already the transport of choice for rock stars and football teams, are becoming increasingly popular with wealthy Russians holed up in London. The company, which charges rich owners to operate their planes, grew revenue by 39 per cent in the year to 30 June, driving underlying operating profit up 140 per cent to £1.2m.

Of course, the acquisition of International Jet Club chipped in. More importantly, it added nine long-range, heavy jets to Hangar 8's fleet, taking the total to 24. In the air for longer, they generate far higher margins. An increase in contracted revenue to 82 per cent of the total and longer-term deals worth 42 per cent of revenue improve visibility, too. Engineering revenue tripled to £3.2m after Hangar8 took the work in-house.

SHARE TIP UPDATE:
Cantor Fitzgerald forecasts adjusted pre-tax profit of £2.8m in 2014 (from £1.9m this year), putting Hangar 8 shares, at 205p, on a forward PE ratio of little more than 8. That's cheap. Buy

[rivaldo] 02/12/2013 08:14

Nice start - and new chart highs now (EDIT - well, they were!)..

[rivaldo] 01/12/2013 11:16

Good PR for HGR8 here in the Independent:



"Jet firm profits soar in wake of Africa's minerals boom

One side effect of the African oil and minerals boom: big profits for the British company that provides the air evacuation service for injured or sick workers.

Hangar 8 just reported full-year profits up 69 per cent to £8.3m, partly due to the rise in the number of emergency airlifts it's making these days from Nigeria, DRC and central Africa. From broken legs to dengue fever, the risks miners take are many, with the mines isolated and lacking in medical resources. Hangar 8 treats the sick in medically equipped planes while whisking them off to the nearest decent hospital. Often that means repatriating them back home.

Just one thing: I wonder if the companies are as caring with their local employees as their expats?"

[dewtrader] 01/12/2013 08:57

Anyone followed this litigation. Hangar8, planes, Mr Dryden, wives, and some russians.

Litigation

hxxp://clients.squareeye.net/uploads/xxiv/judgments/Emerald_Bay.june2013.pdf

[rivaldo] 01/12/2013 08:24

Agreed goliard, though I'm hopeful that 300p will come much quicker than in 12 months.

Apparently the IC had a tip update on HGR8 on Friday and repeated their Buy rec (subscriber-only, but here's the intro - I'd appreciate it if someone could paste the whole article):



"Hangar 8 takes off

Hangar 8's (HGR8) expensive jet aircraft, already the transport of choice for rock stars and football teams, are becoming increasingly popular with wealthy Russians holed up in London. The company, which charges rich owners to operate their planes, grew revenue by 39 per cent in the year to 30 June, driving underlying operating profit up 140 per cent to £1.2m."

[goliard] 29/11/2013 14:09

I'm not much of a fan of technical analysis, but many others are, so worth noting that we are testing the highs of 12 months ago and a break above that is a strong indicator of a longer rally.

Still think 300p would be cheap, but quite happy to wait another 12 months for it.

[rivaldo] 29/11/2013 10:56

Nice - Westhouse have this morning initiated coverage of HGR8, with a Buy and a 270p target price:



270p is more like it, but imo HGR8 could trade at well above 300p given:

- the cheap P/E and EV/EBITDA
- the cash pile
- the huge discount to Air Partner's rating

Whichever the case, there's plenty of upside.

[rivaldo] 29/11/2013 09:06

It's worth noting what Seymour Pierce had to say back in January '13, when the share price was 206p. Since then HGR8 have delivered on their promises, achieving 19.1p EPS and increasing their cash pile to almost £4m, yet the share price has barely moved since this was written. Here's a couple of extracts:

"Plane Good

FY12 was another year of strong progress with Hangar8 delivering against
all its key targets. The twin objectives of taking on heavier jets, which
generate higher margins, combined with the strategy to sign longer term
charter contracts, which improves revenue visibility, have significantly derisked the business. Hangar8 achieved in the year a like for like 56%
increase in adj EBITDA with margins improving by 190bps. We expect
that the momentum evident in FY12 will continue into FY13 supported by
the acquisition of International Jet Club which makes good strategic sense
in our view.

Company profile
Hangar8 is a service business with a logistics arm. The company does not own any
planes but concentrates on managing them for the economic benefit of owners.
Typically, Hangar8 generates significant economic benefits for the owners of aircraft by leveraging off its operational scale to reduce running costs and increase revenue opportunities.

FY12: Strong improvement in profitability
In the financial year ending 30 June 2012, Hangar8 reported sales of £17m, up 9% on a like for like basis (FY11 £18.2m over 14m period). However, reflecting the high level of operational gearing inherent in the business, adj EBITDA was up 34% to £1.1m (+56% LFL, SPe £1.2m) and the EBITDA margin was up 190 bps to 6.3%. Adj EPS was 12.8p compared with 13.3p in FY11A but the previous year's adj EPS number was flattered by the fact that no taxation was paid compared to a £0.2m tax charge this year.

Changing business mix
Structurally this was also a very good year. The number of aircraft under management was broadly stable year on year at 31 (FY11: 32) but the mix of the fleet significantly improved with the number of heavy jets under management up by 5 to 13. This is noteworthy as the heavier jets typically generate better margins. The results also show the significant progress made on improving revenue visibility by focusing on longerterm charter contracts which accounted for 68% of sales by year end (0% FY10)."

"Valuation

The shares have outperformed the wider market by more than 62% over the past year on the back of a very bullish 1Q13 trading update which reported a 331% increase in BITDA to £461k. Nonetheless, despite this spectacular rise we believe the shares still ffer good value, trading on a prospective P/E of 10.4x FY13E. This compares with a mall cap industrial transportation forward P/E of 11.9x. In our view this rating sgnificantly undervalues what we consider to be a well-managed business with xciting growth prospects.

Given the strong momentum behind the business and improvement in quality of
earnings we are BUYers of the shares"

[eric76] 29/11/2013 08:45

what you mean where are the survivors buried?

[dewtrader] 29/11/2013 08:44

What happens if a plane crashes

[rivaldo] 29/11/2013 08:07

Nice start - some momentum here now.

[rivaldo] 28/11/2013 11:39

Cantor's new update note concludes as follows - they cite a P/E of 8.1 and a target price of 240p, which imo is very conservative and allows them to upgrade on any news or a further trading update:

"The shape of the business has changed considerably in recent years with Hangar8 well positioned to achieve further growth. Revenue visibility continues to improve with contracted sales now accounting for 82% (1H13A 64%) of group sales.

Longer term contracts accounted for 32% of group profit margin. The number of heavy jets under management has increased by 11 to 24. This is a positive step as heavy, long range aircraft provide greater margins and business opportunities for Hangar8. Management's decision to internalise the provision of engineering and maintenance services is also bearing fruit, cutting costs significantly and now accounting for 14% of group sales.

On our current FY14E estimates (adj. PBT £2.8m) the shares are trading on a 1 year forward PE of 8.1x which we believe significantly undervalues what we consider to be a well-managed business with exciting growth prospects. We reiterate our BUY recommendation and TP of 240p"

[insideryou] 28/11/2013 09:05

POST 95. As Rivaldo pointed out, you are a complete moron who has not taken a minute to study the history of Burns... What a tool!!

[rivaldo] 28/11/2013 08:38

I gather that Cantor's forecast for this year are now £2.8m PBT, massively up from last year's adjusted PBT of around £1.9m.

This against a £20.9m m/cap. And the EBITDA will look much better than that given the high amortisation charge.

Plus, strip out the cash and the current year P/E falls to likely around 8 or even less.

IMO there's around 50% and more upside from here, especially if there are more acquisitions as flagged.

[rivaldo] 27/11/2013 19:38

Exactly Handwinder. HGR8 are now probably on a current year P/E of only 8 or so even after today's rise.

And that's before you strip out the cash pile.

Anywhere from 300p-400p would be reasonable value on fundamentals, let alone if you assign a growth rating to the stock.

Post 95 is completely idiotic. I've followed NT's selections for years - and he's kept a number of those selections for a long, long time, including long-term favourites of mine like ETO, CAR, CEO or others like TEP, DIA....too many to name.

Like any good investor he reacts to circumstances as they arise or change. I wonder why it is that he's amassed quite a large band of readers. Perhaps it's because he's actually quite good at what he does. Readers of his column who've retained his stocks as he has will know that he's picked many baggers or multibaggers. This is just not possible without holding long-term.

[hazl] 27/11/2013 18:24

crikey...looked as if it was going into reverse this morning! Blur has done well too today 8-)

[handwinder] 27/11/2013 17:47

Warning noted but this is a good stock and realy should be valued at more than 10x, £3.00 would not be expensive,

[dan_the_epic] 27/11/2013 17:26

WARNING!WARNING!

Naked trader just tipped this stock. He does little research and prides himself on being a "Momentum Trader". He has a following of lemmings who follow him into trades. They get to know ahead of the email he sends out. He and those in the know profit. Everyone else spikes up the price. he then sells out later on the spike

BE CAREFUL, be VERY CAREFUL. The lemmings dont even realise that they only get about 2 lines of information before piling in. I repeat, the NAKED TRADER IS A MOMENTUM TRADER, NOT AN INVESTOR.

Look at what his 'tip' did to SEEING MACHINES today. It's all concerted rubbish

WARNING complete

[rivaldo] 27/11/2013 16:29

HGR8 is very undervalued anyway - it just needed a small push to get things going.

As I said, 300p-400p is a more realistic valuation now imho for this transformed business.

[eezymunny] 27/11/2013 16:18

Indeed "I've bought Hangar 8 (HGR8) a company in a similar sector Avation has already done well for me and this one could join it I hope" from NT website.

"Certainly looks worth a bit more than the current £19m and I'd have thought a nice run up to 250 then 300 is a good bet."

Sounds about right to me but Mr Market will decide!

I don't know how many idiots are daft enough to follow his purchases blind but this could really spike given the illiquidity. Hope nobody gets damaged at the top!