Keller Share Discussion Threads

[jonwig] 07/1/2008 12:09

lisleryder - with under 1.5% of the issue out on loan, short selling isn't a major feature here.
But some instis have reduced their holdings (window-dressing?) which has aggravated the slide.

I see absolutely nothing wrong with short selling, though significant positions should be declared. Would you ban put options (for portfolio protection) or other hedging instruments?
And short sellers don't always make a profit - remember that they have to close their trades. I don't ... I can hold my shares 'for ever'.

[lisleryder] 07/1/2008 10:22

I sold at 1121 on 22 Oct making a good profit. I then came back in looking at what seemed to be excellent value at 854 on 26 Nov.

Now I'm feeling angry at what seems like unethical practice of short selling. If the Government wanted to restore confidence in the markets could it not make this practice illegal, as with insider trading?

[aspex] 07/1/2008 08:26

Push "GO" button to restart?
Up 23 so far.

[jonwig] 06/1/2008 16:45

Interesting bod.
Thank you!

The first five on the list won't be of much interest to sane investors ...

ABBY, as a UK and Ireland housebuilder, has already signalled difficult trading ahead.

TLT is an interesting one, with strong asset backing and, I suspect, a good reputation in its core areas. But the shares are tightly held, as you say, and a MCap of just £23m does mean it won't appeal to many. It's just signalled an encouraging outlook.

HYWD seems to be a steady but lacklustre performer with an acquisition to assimilate.

SSV, Irish, is very highly geared.

VST - Irish, makes doors. Tiny company.

So, were I coming new to the list, and reading also what the companies themselves have to say about their prospects, only ABBY, TLT and KLR would hold any appeal.

[bird of dawning] 06/1/2008 16:11

It might be useful to note also that Keller has the second lowest price/sales ratio taken from the above list (2.37). The lowest p/s is Abbey (1.09). Only 5 companies listed above have recent trades; SMC, HYWD, ABBY, TLT, KLR.

It may also be worth noting here that Abbey is currently selling at below its liquidation value (NCAV)i.e. net current assets (working capital) less all long term debt including its pensions facility.....£128.92m, current m/cap: 123.13m, with low gearing. This value situation was much favoured by legendary value investor Benjamin Graham as a `bargain issue' c/w margin of dafety.


Price/Sales:-
SMC: 8.3
HYWD: 6.52
ABBY: 1.09
TLT: 7.18
KLR: 2.37

Out of these last 5 companies (with recent trades) only Tolent/Amco is a similar business to Keller, focussing on ground works. Tolent/Amco shares are mostly insider held (more than 50%) and therefore relatively illiquid. I would suggest that this places Keller as the second best candidate out of the bunch from a strictly value assessment.

Regards bod

[masurenguy] 06/1/2008 12:50

Good perspective SG !

However, whilst there is no known formula to pick a top or bottom I just feel that much of this is already reflected in the price. That doesn't mean this couldn't still move lower although the downside should be limited now and a turn could be closer !

[jonwig] 06/1/2008 12:46

Simon, you make a worthwhile point, as always.
But KLR is being singled out by the market, whilst your point would apply to the whole sector.
Here's the Construction and Materials sector in order of increasing PER. KLR is at no.11 ... take out the top three loss-makers, and SMC (a basket case)and KLR, at no.7 has the highest MCap of any of these companies.
(Source, Sharelock Holmes)

MCap(£m) P/E
DIMENSION RESOURCE 0.9 -17.0
BOU BOUSTEAD 1.4 -4.6
CRYB CRYSTALBAND 0.6 -1.3
SMC SMC GROUP 3.7 2.0
NAQ NBA QUANTUM 1.4 2.3
HYWD H'WOOD WMS 39.2 5.2
SSV SITESERV 32.1 5.5
VST VISTA GROUP 2.4 5.6
ABBY ABBEY 123.1 5.9
TLT TOLENT 23.4 6.3
KLR KELLER GROUP 387.2 6.4

I don't know much about NAQ, HYWD, SSV, VST, ABBY, TLT, but I'll bet most of them have special features which account for their low rating.

[simon gordon] 06/1/2008 12:17

According to ADVFN less than 2% of KLR's equity is on loan.

I think the reason KLR is being hammered is the fear of a hard landing in the core markets that KLR operate in.

The market is looking to the future and the share price is indicating that it expects KLR's profits to fall.

End user demand could now fall sharply as the Banking crisis shrinks liquidity, with property and construction being the first to feel the contraction.

KLR is a very well managed company but if the economy turns then nothing will stop the share price stagnating/falling - bar a takeover.

The market could be wrong but investor uncertainty is palpable.

[johne1] 06/1/2008 11:59

chris79 - 6 Jan'08 - 11:33 - 502 of 502

I agree. I consider the share price falls as a possible buying opportunity. However, chartists will see the shares on a severe down trend. If the price continues to fall, more stop losses etc. will be triggered. Therefore, the bottom would be difficult to call.

Then again, who can say that they have called the bottom on their purchases? - I can't.

I read many threads where folk chat about how they wished that they had bought shares when they were good value. It is these times which present the value which entrepreneurs relish.

I will only cut my losses if the company is bad. KLR is showing no signs of that and is announcing news that it is weathering the current economic down turn. I will, therefore, not take a loss here.

For my current holdings, I will hang on. For future additions, I will wait a while, before spending my hard earned cash.

My long term investment plan is until I retire, which is not for some years yet.

How long is long term?

[chris79] 06/1/2008 11:33

Well at least the bb has seen a few posts recently! Seriously though, i cannot disagree with a word that bottomguessing (and indeed many others) says, just don't think you are alone. I work in the industry and it is not just private investors struglling to make money, it really is virtually everyone! Unless of course you are a short-seller who relentlessly picks one company after another to short-sell and destroy - what a shame it is to see people on here who are selling just because they think they must be wrong based on the share price fall. Unfortunately fear and greed really do drive markets. It really is a savage market since September(ish), but this is one superb company as all of the numbers show - profits growth, orderbook, management etc - ever key component. Often you look at this sort of stock and there is a but (generally high debt IMO), but here there isn't it has a strong balance sheet. It is just being pounded due to short selling, causing fear and additionally a wish of some funds to exit 250 stocks like this at any price. I guess the one negative people talk about is the slowing in construction, but this is not looking forward it is now and the 20th Dec statement with profits again to beat expectations shows Keller continues to trade very well. Best of luck all, in the long-term i am convinced the share price will do as well as the company is!

[jonwig] 05/1/2008 08:10

When KLR bought H J Foundation Inc (RNS, 2 Oct) there was only a single one-line post on this BB to celebrate the deal (though the KLR share price rose nicely):

HJ, a specialist piling contractor, is the market leader in Florida in Continuous Flight Auger (CFA) piles, a growing product line which is new to Keller in the US. In the year to 31 December 2006, HJ reported operating profit of around $25m (£12.5m) on sales of around $92m (£46m).

The business has enjoyed tremendous success in recent years, benefiting in particular from the very buoyant condominium market in Florida. In recent months these exceptional market conditions have been returning to more sustainable levels and this has been fully reflected in the purchase price. Keller is paying an initial sum of around $49m (£24.5m), payable in cash from its existing resources, with a potential earn out based on future profits. No earn out will be paid unless average annual EBITDA over the 27 months to 31 December 2009 exceeds $12m.

That means HJ has operating margins of some 27%. In KLR's own latest numbers, they were proud to have reached record margins of 9%.
No wonder JA said the acquisition would be earnings enhancing.
Of course, "condominium market in Florida" is no longer a sweet spot, but this does underline KLR's ability to maintain its market-leading position.

There's an article here about Continuous Flight Auger, including a cartoon demo:



The technology isn't unique to HJ; Skanska use it:



I don't know how acquisitive Skanska are as a company, but KLR would be 'finger buffet'.

[lynica] 05/1/2008 01:16

bottomguessing- thought about quitting myself today after being hit on Keller but decided that you can still make money on the markets with a bit of research on big caps. I beleive the mid/small caps will be hit harder than certain big caps over the coming months so have short listed up to 20 where the chart is moving in the right direction and have stayed bouyant over the last few months since he credit crunch took hold. stating from basics again at £1 a point and forgetting the falling knives routine!!

There are obviously numerous shorts in the ftse 100 as well

dyor and keep the faith, going to bed now to dream about making a profit!!

[bottomguessing] 04/1/2008 23:43

thanks for the advice Melody. will be watching from the sidelines.

Stomach is to weak for this.

Still think these are really cheap and i think will seriously bounce in the coming weeks. but that's it with this market no logic. Interest rate decision next week and hopefully have some big buyers back in the market, Dow & FTSE both needed this drop today.

If this drops much further it's a definate takeover target.

can't believe the Credit Crunch has knocked 50% of this stock, shorts having fun with this.

[melody9999] 04/1/2008 22:55

been watching but thats all. a fair bit of knife catching? the problem at present is that the market does not respect positive reports and low PEs. I have held RCG for months through troubled times for the share price - because the company continues to report good trading and increasing profits. Value may out in the end but the end can be a long time coming - too long if you are leveraged. In the meantime my capital could be making money elsewhere. Good luck to all and to bottomguessing my advice would be:
1 stay away from s/bets
2 buy shares that are rising not falling. even better those that making new highs - look at DGO today for example
3 palm oil my big favourite for 2008 - in 2007 my big gain was SOLA and this year it could be NBPO

[steeplejack] 04/1/2008 20:08

All i know is that Keller will be either a good deal higher than this in a couple of years or they would have been taken over.As for the antics of a few shorters they'll be as memorable as a bout of flatulence in a wind tunnel.

[bottomguessing] 04/1/2008 19:09

so has everyone, don't beat yourself up about it.

have a good weekend!

[bottomguessing] 04/1/2008 19:09

so has everyone, don't beat yourself up about it.

have a good weekend!

[rgcol1] 04/1/2008 18:30

I wouldn't watch the shares you were holding, i agree 100% with that sentiment.
to many times i have bailed out at a loss only to see the share price rise immediately.

bottomguessing,il tell you when i bail out because thats the best buy signal you could possibly have.

you should make loads of dosh.

im off now to lick my wounds, ive had a right kicking today.

[bottomguessing] 04/1/2008 18:15

KLR is a great company and value will prevail but shorters will take advantage of the fear in the market. perfect stock for it with low volumes.

As Johne1 said to me today - "I wouldn't watch the shares you were holding. We've all bought something in the high street, only to go next door and find that we could have bought it cheaper!

Very true, you've got to buy a share for the right reasons and expect that it can go down before it goes up.

Hopefully as you said Rgcol1 there will be alot of buyers about next week and with a near 15% drop in 2 days we should see a nice bounce. Also we have the interest rate decision next week so the FTSE falling it could do us a favour.

[rgcol1] 04/1/2008 17:55

can't see why not,shorters have to close to make any money + big boys with thier big wallets back next week.

[bottomguessing] 04/1/2008 17:44

LOL.

It could well fall some more but then again so will everything else, it's the whole market that's feeling the it!

I'm sure we'll see a quick recovery.

[rgcol1] 04/1/2008 17:43

i can guess what the c in jimmy c stands for.

[bottomguessing] 04/1/2008 17:22

jimmy c - 4 Jan'08 - 16:33 - 485 of 487

"Would not surprised to see these well below 400p." Not short by any chance are you lol

So you think well below £4 which at £4 is a Mkt Cap of 265mln with profits of Circa £90 mln plus! so PE of 3, and a Div of 4%+ I'm no professional but that's riduculus.

To much sub prime has been associated with Keller, as many other stocks but the company hasn't changed, they have a good order book, niche market & will announce excellent results in March.

I'm not in but watching, and reading posts, and i spoke to soon when i said there where any shorters on this BB deramping.

Well good luck longs