Kier Share Discussion Threads

[minerve 2] 28/5/2019 23:39

Thanks for your reply ltcm1

You've obviously noticed I've unfiltered you. ;)

I'm not particularly impressed by Woodford since 2014 but he still is worth watching IMO. His exits on some have been well-timed although it is difficult to say whether his fund - being so large - has driven self-fulfilling action.

I'm attracted to Kier because their business fits well within the rest of my portfolio. It is obviously stressed which makes it cheap - which is also an attraction - and is really a turnaround type situation which I think they have a good chance of doing. Brexit is making some stocks very cheap and the cheap pound is attracting inward investment into some areas which will benefit Kier. To some extent this is a play on Kier working capital trend....

Civil servants are generally very much centre right when it comes to political bias so I think they will not want to see any further problems in this space whilst the political turmoil continues. They don't want to handover the keys to Corbyn so I think the chances of another Carillion or Interserve are very remote. Utilities are upping their game to meet new regs coming in. RS2 (vs RS1) budgets for highways will be significantly higher where Kier is the number one contractor. HS2 is an obvious subject of discussion but in the context of Kier it is just another project in a plethora of opportunity. If HS2 gets cancelled other projects will happen with the budget I have no doubt. You can't just cancel a project so easily without sweeteners and these will be in more localised development and in large Northern projects IMO.

I expect this share price to turnaround soon, I believe a trading update is not far off (June/July) and it may then be an opportunity to start building my second tranche. I'm not worried about the share price Entry has to be planned over 18 months in situations like this. You should be comfortable with shifts up to and over 50%. If you are not, this isn't your game.

When everyone is scared you get the opportunity to buy and outperform. Sometimes you are right, sometimes you are wrong. This is definitely NOT a Buffet-esque investment but it could be a nice steady yielder if they turn this around. At my buy-in the yield will be very high if it works out right.

Good luck! ;)

[gettingrichslow] 28/5/2019 21:54

mad foetus, I do use him as a contrarian indicator, but I'm afraid he just provides me with so many laughs I can't bring myself to filter him. And the best is yet to come when we leave the EU on WTO in October, he'll be apoplectic!

[ltcm1] 28/5/2019 21:45

Minerve it wasn't directly to you but I am glad you have been very wise and only invested the 2%, obviously your Kier investment has to also be viewed in the context of your portfolio.

I do accept it could be a good time to buy now that many are fearful here and also the weak holders are getting flushed out it would seem.

Minerve my argument is not with you, it is with Woodford. I get you like to fire three or more bullets at an investment but when Woodford does same he ends up almost owning the bloody thing! I can see what you are doing is an advantage for the small investor but at the level he is trading at it becomes a negative.

It is hard to understand what he sees here because if it didn't exist you would never invent a business model like Kier's. I like the Corbyn Construction moniker because at it's core Kier feels like capitalism in reverse. I mean their main building achievemnet to date has been the creation of an enormous managerial empire. They have built something so big they need to do £4BN a year of turnover just to break even!

It is crazy, insane and wrong and I can't fathom why anyone with Economics training would be attracted to this behmouth.

[mad foetus] 28/5/2019 21:23

I know it may seem fun to laugh at Walter Mitty but it is better just to filter him, unless you want to use him as a contrarian indicator, as he really is first class at going balls deep without a clue.

[brexitplus] 28/5/2019 21:19

Getting

You have poor old Porky by the balls. As you say it’s always the same - he changes or avoid the subject. We’ve caught him out so many times.

230p I think.

[minerve 2] 28/5/2019 21:11

Getting

You can stop trolling here. I filtered you a few days' back.

I will not be changing my mind this time. I have given you enough chances but you simply haven't got anything that you could offer me that is worth listening to. Sorry about that but there is no point in pretending your opinion has any value when you are not in ownership of the right knowledge or the full facts.

Same thing goes for brexitplus. Filtered.

I would suggest you get back to pretending you are important in airports and brexit gets back to cooking a roast on the weekend. Cheers!

[minerve 2] 28/5/2019 20:44

ltcm1

I don't know who you are attempting to address but if it is me I can assure you that I have read the accounts and can see where problems and off-balance sheet debt is. Thank you for your concern but I fully understand the risk. As I have mentioned on another thread, if this goes belly up it is no big loss to me. It occupies less than 2% of my portfolio.

Joint venture commitments are fully funded.

The share price could go anywhere, it doesn't need to rise at all. Sink cost fallacy is for idiots.

The question is: does this have value, or doesn't it?

If you think it is a value trap, move on. Stop trolling and save yourself some time.

[brexitplus] 28/5/2019 19:52

Any answer to my question re the next support level? My best guess is 230p.

[gettingrichslow] 28/5/2019 18:04

This is strictly for lemmings only, this company is in big trouble in a troubled sector. I'd rather buy a big bottle of snake oil than this.

[ltcm1] 28/5/2019 17:26

Well one way around reducing your payment times is to have people invoice you say 10 days after you have received the goods.

This creates another problem in that goods received could be incorporated into WIP on the balance sheet ie an asset, yet the corresponding money owed won't appear on the accounts atall at a half year date say.

Obviously I hope this isn't the case but you could see how the pressure to alleviate one problem can create another.

The shares now need to rise 50% just to get back to the Rights Issue price of 400.

The other thing is that Joint Venture partners must be starting to get nervous.

[gairich] 28/5/2019 16:43

This just keeps getting better and better, its definitely an investment for dunderheed's

[porsche1945] 28/5/2019 15:31

these are a gonna, 1.20 next stop, you muppets still averaging down haha

[montyhedge] 28/5/2019 15:07

Those fund managers who took stock in the placing must be under pressure, how do you explain this in your monthly meeting, why you are still holding this.

[minerve 2] 28/5/2019 14:41

Payment days are reduced and so is the need for reverse factoring since the rights issue.

[jonwig] 28/5/2019 14:38

@ mrfixituk - re Kier being a late payer, I've lifted this from the recent (23/05) article in IC:

Ostensible borrowing from banks to pay suppliers earlier than the standard payment term is classified in the balance sheet under 'trade and other payables' – a working capital item rather than debt. With 60 per cent of subcontractors using the early payment scheme, the amount of supply-chain finance has been increasing – it was £201m in December, up from £175m a year earlier.

I suspect that HMG's willingness to award contracts is tied to a commitment to pay bills early. So Kier probably isn't a late payer at present. But, in effect if not in accounting terms, it is borrowing more to achieve that. So not great, either way. IC's recommendation was SELL, at ~312p. I wouldn't argue against that.

[Incidentally, in the '80s "Mr Fixit" was, of course, Jimmy Savile. Not really a judicious handle to choose.]

[mrfixituk] 28/5/2019 14:10

Kier one of the worst late invoice payers! Combined with a creaky balance sheet, 6 month low, poor reviews and sector stagnation. Big crash coming?

[brexitplus] 28/5/2019 11:27

ltcm1

GKN, before its acquisition by Melrose, was doing precisely this to improve its year end accounts.

Builders are well known for moving items across the financial year end for the same reason.

[ltcm1] 28/5/2019 11:23

Ofcourse in building it is possible to have suppliers deliver you goods and then invoice you in x number of days. Which could or could not overlap with the end of accounting periods.

I'm not suggesting for a moment this goes on at Kier but there does seem to be a very fundamental question being asked about profits at this company.

[brexitplus] 28/5/2019 11:10

ltcm1

Futureproofing existed before the recent problems but surely financial difficulties must have been apparent to the top management. Slow payment to suppliers and infighting between commercial and project managers are a bad sign. I fully expect a release regarding finances before the review in July.

[ltcm1] 28/5/2019 10:05

Anyone here think Kier's 'Futureproofing' is simply a euphenism for a jaw dropping mind boggling cash infusion???

[ltcm1] 28/5/2019 08:45

This person "johnwig" is himself an inpersonation of highly respected poster and author of the WPCT thread jonwig.

I suggest you make your owns up about an individual who seeks to confuse and manipulate.

[johnwig] 27/5/2019 12:23

This thread is basically "Minerve" versus the "shareprophets" (six nicknames = 1 real person). So the debate is likely to be entirely bogus. LOL.

God knows what the scoundrels are up to! It won't be good for the honest shareholders on this thread, I promise. They are trying to mislead you, for certain.

[gettingrichslow] 26/5/2019 13:16

It's not my bonus Minny. That's a different payment. This is the LTIP from the last 3 years and reflects all my hard work on golf courses and in airport bars in particular. It's tough out here in the working world Minny! I've got to squeeze in a cricket match and a corporate golf day next week!