Mears Share Discussion Threads

[nellie1973] 10/8/2009 16:15

How many days in a row has this risen?? This has been steady for the past month. At last the true nature of this stock is to be realized.

[5dally] 10/8/2009 15:29

Nice move here today :-)

[mdrans1] 10/8/2009 12:59

hosede

"As more and more councils get into dire financial straights, they will pay their direct employees rather than MER."

Obviously you have never worked in local government. That's not how it works.

[rivaldo] 10/8/2009 10:37

Results next Tuesday the 18th, so we can expect a continued run-up to that date given the excellent trading statements.

MER also has healthy net cash and lots of facilities if required.

[hosede] 10/8/2009 10:10

Yes as risk aversion increases, MER will be one of the beneficiaries, but in the medium term bad debt/slow payment is going to be their main problem. As more and more councils get into dire financial straights, they will pay their direct employees rather than MER. I guess they will get most of their money eventually, but cash flow could be difficult; most of their costs are labour I assume, and you can't really avoid paying that on the nail

[rivaldo] 10/8/2009 09:12

Off we go again.

[essentialinvestor] 09/8/2009 10:42

Some more good news from Nestor Healthcare last week which reported results.
Their main division is Social Care which is Home/Domiliciary Care..

"The Social Care business delivered profits up £0.2m to £4.3m (2008: £4.1m) with an improved margin of 8.2% (2008: 7.7%)."

They further add that "Care worker recruitment is no longer an inhibitor to growth."

So margins increasing and recruitment now far easier in this Sector.

With Home Care now one of MER's main drivers of growth over the next few years,
the powerful combination of rising margins and easier recruitment are very positive.

No wonder Claimar is said by the FT have attracted 10 different bidders for the
Company.

[cravencottage] 09/8/2009 10:23

Thats an interesting post Riv.

I hadn't realised that by May of this year Mears had already secured 92% of their expected revenue for 2009.

So with the additional contracts secured thereafter this old Gem has to be a no brainer.

I remember when Mears was trading at a PE of 20. Now I know growth has slowed down a tad but glancing at the latest estimates for 2010 analysts are looking for around EPS 25p.

So if Mears can be re-rated similarly to Connaught a target price of 350p should be in the offing.

Here's hoping

Cheers

CravenCottage

[essentialinvestor] 07/8/2009 19:17

The closer you look at Mears the more value you begin to discover here.
They have cash balances compared to net debt at CNT who sell on a higher rating.

Add back on CNT's debt to their market cap and you discover what value there is at anywhere near these levels by comparison.

Claimar received a bid for approx 40 million today (19.5 million plus their debt of approx 20 million) the shares up over 100% on the news.
Claimar are a Domiliciary Care play, one of Mears main markets and shows
how strong future prospects are in the Home Care market.

Mears looks due a strong run Up to results and a re-rating IMO.

[lucky_lady] 07/8/2009 13:29

Holding up well on a down day.

Results soon.

[rivaldo] 07/8/2009 11:01

Interesting - two RNS. with both Aegon and Lloyds top-slicing. So the intriguing question is who is buying given the rise?

[rivaldo] 07/8/2009 10:00

Continuing to slowly climb.

[rivaldo] 01/8/2009 10:36

Good comment in today's Independent:



"Holt runs another portfolio constituent, the rather more successful Mears, which is engaged mainly in social housing and domiciliary care and is seemingly in a strong position to resist recessionary damage. Its profit record is encouraging and another strong performance is expected this year. Interim figures are due later this month.

The only drag could be the small mechanical and electrical division that mostly serves the private housing market. Yet, in its April trading update, Mears referred to the division's niche appeal and seemed confident about its prospects. The social housing and home care operations are sheltered by long-term contracts with a range of local authorities and other public bodies.

Care is a relatively new activity. Holt believes it could develop as impressively as social housing as more and more organisations are forced to outsource their requirements in the battle to shave costs.

Mears has been particularly active on the housing front. It recently clinched a £200m, 10-year deal with Brighton and Hove City Council, which lifted this year's total order intake to approaching £400m. In April the group had already accumulated 92 per cent of this year's forecast revenue."

[rivaldo] 31/7/2009 14:55

Nice Buy rec in today's Scotsman:



"ONE TO WATCH

Mears Group

247p -3p

Scotsman says BUY

MEARS is one of the UK's leading providers of social housing and domiciliary care services. Its social housing division, which accounts for 77 per cent of earnings, provides maintenance, refurbishment and estate management services for social homes.

The domiciliary care division provides care at home to the elderly and disabled and accounts for about 14 per cent of profits.

The company has very good visibility underpinned by a strong forward order book. Mears has won more than £400 million of work from existing clients in the year to date, leading to 95 per cent visibility for 2009 revenues and 65 per cent for 2010. This compares with £460m of contracts won for the whole of 2008.

Clients are looking to consolidate their supply chain, which should bode well for future tenders.

The bid pipeline remains strong and there are a number of tender opportunities worth £100m plus, two of these being with existing clients so it is probable that Mears will win further large-scale contracts.

The shares have under-performed the FTSE All-Share by 8 per cent over the past year over fears about Mears entering the domiciliary care market. Domiciliary care is an industry characterised by budget pressures, high staff turnover, supplier fragmentation and poor levels of service delivery. Mears has performed well in this often challenging market and seems to be slowly building a quality franchise.

At present, Mears is trading on a 2009E P/E of 11.1x falling to 9.5x 2010E and yields 2.2 per cent, rising to 2.6 per cent in 2010. In addition to this, the company has a strong balance sheet with an estimated net cash position of £20m at the end of 2009."

[nellie1973] 28/7/2009 08:10

3 weeks of a nice steady uptrend ahead.

[rivaldo] 28/7/2009 07:34

RNS out - results to be announced on 18th August. Given the strong trading as per the IMS and then AGM statement we can expect them to be good:



Only 3 weeks to go....

[nellie1973] 27/7/2009 17:12

Yes nice day again on build up to results!

[rivaldo] 27/7/2009 09:48

Nice start again - going above recent highs.

[rivaldo] 26/7/2009 07:37

There is a brief summary of the MER tip on the IC web site FYI:



"Join Mears' bonus bonanza
Created: 23 July 2009 Written by: Algy Hall
BULL POINTS:

■ Strong order book
■ Defensive end markets
■ Long-term growth opportunities
■ Strong balance sheet

BEAR POINTS:

■ Corporate governance issues
■ Weakness of mechanical and electrical division"

[rivaldo] 24/7/2009 11:18

No probs. Gathering speed now.

[cwa1] 24/7/2009 08:42

Thanks for all the input guys. It is appreciated

[rivaldo] 24/7/2009 08:29

Two in two days - MER is tipped as a main Buy in today's IC. Let's see if we get some decent buying as a result.

[rivaldo] 23/7/2009 11:39

Many thx pbracken - 340p would be about right.

MER also got tipped by Shares Mag this morning as one of ten "summer sizzlers" to watch!

"Mears (MER) 235p
This year's earnings growth: 32%
Next year's earning growth: 14%
Yield: 2.4%
The social housing repairs and maintenance provider is benefiting from
clients' desire to work with fewer suppliers.

Judging by the recent strong run of contract wins with existing clients,
Mears is proving to be one of the preferred service suppliers. It has good
earnings visibility with around 95% of 2009 forecast revenues secured and
65% for 2010, according to house broker Collins Stewart. Growth is also
being driven by the domiciliary care market, which Mears entered in 2007
through the acquisition of Careforce.

Both social housing and care services are defensive sectors with largely nondiscretionary spend, underpinning Mears' strong growth prospects. (DC)"

[pbracken] 23/7/2009 10:14

Mears
�� Significant contract wins – Mears has announced contract wins totalling c£270m
since the beginning of July and takes current year new contract wins to c£400m.
�� Bid pipeline strong – Confident tone to accompanying statement and "significant
pipeline of contract bids" underlines the group's high quality of earnings.
�� Strong earnings growth - EPS is projected to rise at a CAGR of 12% over the
next three years; above the median of flat earnings for the wider sector.
�� Price target of 340p – The group trades at a PER of 11.5x 2009E and 10.1x
2010E and on a multiple of 6x 2010E EV/EBITDA, thereby pricing minimal premium
(c5% on forward earnings) for above sector average forecast earnings growth.