Renew Share Discussion Threads

[cockerhoop] 05/10/2016 07:32

Here's a portion:

The company is scheduled to release its full-year results on Tuesday 22 November 2016, so this is a good time to review its trading prospects. Analysts at Numis Securities and WH Ireland both predict the company will deliver pre-tax profit of at least £21m and EPS north of 27p in the 12 months to end September 2016 to underpin a 14 per cent hike in the dividend to 8p a share. On this basis, the shares are rated on 13.7 times earnings and offer a 2.2 per cent dividend yield. That's a modest rating for a company targeting an operating margin target of 4.5 per cent in the 12 months to end September 2017, implying a 30 basis point improvement on the year just ended.

That margin expansion is worth flagging up because the margin gain on £550m of revenue for the 2017 financial year accounts for the majority of the £2.7m operating profit growth that WH Ireland and Numis have factored into their forecasts. So, if Renew increases revenues by 5 per cent as analysts suggest it will, and boosts margins to the 4.5 per cent target, then pre-tax profits and EPS could surge by 14 per cent to £24m and 31.1p, respectively, in the 12 months to end September 2017. The combination of 15 per cent EPS growth and a forward PE ratio below 12 offers an attractive PEG ratio of well below one. A forward dividend yield of 2.5 per cent will appeal to income investors based on the payout per share rising by a further 12 per cent to 9p.

Furthermore, with the benefit of a strong seasonal working capital cash inflow in the second half just ended, Renew could have a year-end net cash position of around £6m, reversing a £4.8m net debt position a year earlier, thus increasing the possibility of selective earnings accretive bolt-on acquisitions. Not that the existing business is short of organic growth as a £500m plus order book highlights Renew’s status as a quality, UK business focused on infrastructure (nuclear, rail, water) with robust characteristics.

[glaws2] 05/10/2016 06:29

Sorry Rivaldo no further details - just saw the headline on a tweet

[rivaldo] 04/10/2016 23:06

Cheers Glaws2 - any further details?

[glaws2] 04/10/2016 16:06

Believe the rise might have been triggered by Simon Thompson (IC) tipping with a target of 420p

[broadwood] 04/10/2016 15:54

Yep, delayed reaction to the good news.

[wad collector] 04/10/2016 14:56

Looks like share price has finally woken up after yesterday's good news. Curious delay this morning despite the FTSE100 fireworks.

[rivaldo] 03/10/2016 22:47

Nice close today.

Brief but interesting analyst comment:



"Analysts at Numis said in a note: “While management does not make any comment about outlook, we believe the group will be well-placed for ongoing requirement for non-discretionary work in its key markets this year and could also see some acceleration of work in the rail sector in particular as an area where there seems to be increased focus under the Tories as a pump prime at the time of the Autumn Statement.”

They added that Mr Scott is not expected to alter the strategic direction or business model of the group, which has enabled it to grow 13-fold over 11 years without any equity funding."

[hopeful holder] 03/10/2016 18:09

Judging by the closing share price, the market appears to have expected the news provided today.I'd echo the positive sentiments re Brian May.

[sphere25] 03/10/2016 10:21

Brian May

"..transformed the Group from a loss making building contractor into a leading business in Engineering Services and delivered an increase in market capitalisation from GBP17m to GBP229m without recourse to equity financing"

Absolutely outstanding! I salute you Mr May!

Makes for a nice change on AIM too.

[cfb2] 03/10/2016 10:13

Results understated as usual.

Unfortunately we have to wave goodbye to Brian May. I hope he has a long and happy retirement.

CFB

[santangello] 03/10/2016 10:05

Beautifully understated as ever.....what a consistent, reliable and growing diamond of a company.....

[nurdin] 03/10/2016 07:23

Yes agreed.I also like the fact that margins on the up now...

[rivaldo] 03/10/2016 07:16

Excellent news - trading is in line with forecasts, plus the group has net cash now, so should be ready for more acquisitions:



We're now in a year with forecasts of 30.8p EPS and a 9p dividend, so the current share price is just too cheap imho given the fundamentals and potential.

[harrogate] 29/9/2016 17:51

I doubt that and see post 8236!!

[hvs] 29/9/2016 17:41

ITS fireworks TOMORROW

[harrogate] 29/9/2016 16:59

Let's hope I am correct !!

[santangello] 29/9/2016 16:41

Correction grately accepted Harrogate.

[harrogate] 29/9/2016 15:44

See post 8236

[santangello] 29/9/2016 14:33

Looking forward to tomorrow, could be an interesting end to today too....MMs taking positions for the mornings action ?

[broadwood] 28/9/2016 09:01

J


Just took it from the website.

[harrogate] 28/9/2016 08:50

I am pretty sure the trading update will be on Monday 3rd October and I am sure will be the usual!

[broadwood] 28/9/2016 08:42

Next pre-close announcement
30 September 2016
Next year end (to be reported)
30 September 2016

[essential] 27/9/2016 12:44

Hope this can break the 200dma on the RNS on 1 October. Banged its head 5?times so any breakout will be powerful

[wad collector] 22/9/2016 12:04

And much longer term , RNWH should get some good contracts helping clean up the mess....but we may not still be alive then , and RNWH will be part of some sovereign wealth fund by then. Perhaps.