Renold Plc

0.55 (1.98%)
Share Name Share Symbol Market Type Share ISIN Share Description
Renold Plc LSE:RNO London Ordinary Share GB0007325078 ORD 5P
  Price Change % Change Share Price Shares Traded Last Trade
  0.55 1.98% 28.35 270,620 16:35:14
Bid Price Offer Price High Price Low Price Open Price
27.80 28.90 28.90 28.20 28.20
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
General Industrial Mach & Eq 197.10 10.20 4.50 5.56 63.91
Last Trade Time Trade Type Trade Size Trade Price Currency
16:04:28 O 13,926 28.636 GBX

Renold (RNO) Latest News

Renold (RNO) Discussions and Chat

Renold Forums and Chat

Date Time Title Posts
22/10/201308:15Renold: the recovery story1,817
16/6/200813:00Renold - Long way to go..-
21/11/200715:16Time to SHORT RENAULT.....3

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Renold (RNO) Most Recent Trades

Trade Time Trade Price Trade Size Trade Value Trade Type

Renold (RNO) Top Chat Posts

Top Posts
Posted at 13/5/2023 13:45 by pj84
I am expecting the current years eps to be above 5p.

Last year’s basic eps was 4.7p and the adjusted eps was 4.3p.

From the latest trading update it says: -
“As a result of the stronger sales, the impact of the YUK acquisition, benefits of cost reduction and efficiency programmes, and the successful implementation of inflation cost recovery programmes, the Board now expects underlying trading profit and margin for FY23 to be materially ahead of the previous upwardly revised market expectations (1).”

and note (1) says: -

“(1) Company compiled market consensus for 2023 revenue, underlying operating profit, and underlying PBT is GBP238.3m, GBP19.8m and GBP14.3m respectively.”
From slide 6 of the Capital markets day presentation on 10 May, it looks like the unaudited revenue is £247m and the adjusted OP is £23.5m.

Renold PLC - Capital Markets Day (With Q&A) (brrmedia.co.uk)

It is a long watch, just under 2 hours and whilst it is the company selling themselves, it is nevertheless very informative, and they seem to be very focussed on both inorganic growth and further acquisitions and to be very focussed on a very disciplined approach to capital expenditure for both investment and acquisitions. It also explains that even though Renold is not regarded as a tech company, it is benefitting from the new economy through businesses in all sectors increasing automation and demand for its products which is continuing to grow and in my view even following the recent increase in share price the PE of Renold is far too low.

The following is the summary from the FinnCap update on 17 Apr: -
“The Full year trading update to March 31 is positive pointing to underlying trading profit materially ahead of previously upgraded expectations. Revenue has increased by 18.8% on a CER basis and up 13.4% on a like for like basis excluding the gain from the YUK acquisition. Strong sales momentum in Q4 coupled with gains from the YUK acquisition, cost and efficiency measures and inflation recovery actions to achieve this positive result. Net debt at £29.8m was also better than expected. In FY23 we upgrade EPS by 21% to 5.8p. This places the shares on a P/E of just 4.3x, which clearly looks too low. We also raise our TP to 58p, on a modest 12x P/E target, the shares should respond well to this positive announcement.”

I’m not sure how they arrive at 58p from 12*5.8p unless the 12 is a typo and should be 10*5.8p otherwise it should be 69.6p.

Posted at 12/5/2023 16:21 by this_is_me
It will be another 2 months until the results. An eps of above 5p is likely and a P/E of 12 would see the share price double from around the present value. that is quite possible. Not much hope of the share price getting to £3 it was in 1997!
Posted at 17/4/2023 20:25 by this_is_me
Jump in share price supported by a large volume.
Posted at 17/4/2023 14:48 by km18
Renold issued trading update for the year ended 31 March 2023. The Company's strong performance continued in the final quarter of the year, with revenue increasing by 26.6%
In line with today’s positive results the price opened 16.06% higher, it is trading below a strong resistance level, currently at 28.90 but if it manages it break above 30.00 level then can create a new high and the group states that it has strengthened its financial position significantly over the duration of past 3 years, providing funding capacity to support their growth objectives including both investment in further operational capabilities as well as value accretive acquisitions with a growing pipeline of opportunities putting the group in a favourable position to continue with a strong momentum... from WealthOracle


Posted at 20/2/2023 10:53 by thirty fifty twenty
hi all...

for me RNO is a very likely take over candidate.
i think any bid wold be at >40p+
and thus even if it happens on the last day of my 3 year time horizon, it will yield to me my portfolio target of 15% per annum.

my reasoning...
I think the stock market has valued RNO 'reasonably correctly',
is has moderate debt and a low share rating and thus despite being no 2 in an industry ripe for consolidation does not have the currency to do so.
secondly, the pension is a small theoretical risk. i trust the actuarially profession and calculations but thus by definition of the long term agreement the company will always have to 'overfund' to support the most conservative sceario. in reality this 'overfunding' will return to the company but only when the pension scheme winds down and thus that return is vaued very lowly by the market.

lets take these 2 risks if exactly the same business was part of a bigger business.
1 - those same profits £30m fcst ebitda profits (less the agreed £6m to pension) would be valued at 10 times in a multinational engineering business, and there could even be a premium rating as there was a chance for the number 2 player to consolidate a key industry as global manufacturing on-shores.

2 - firstly the 6m agreed is less material to a multinational thus it carries less risk, and secondly the longevity of a stable multi nationals is seen to be 'forever' as it is diversified and can continually re-invent itself to be around decades ahead. thus any 'over cautious' funding to the PF required by the conservative actuarial calculations is not 'wasted' CASH but just a long term savings plan.

thus to me the bid premium for RNO would be much higher than the average 35% typically seen in the market. indeed - smaller cap UK bids this last 18mths have averaged 50% premiums.

the other side is that if RNO can get some momentum then the returns as a solo business will be greater.

so an investor and risk/reward is see this as win/win
bid scenario is 15% per annum over 3 years (maybe earlier),
RNO pulls it off sees 20% share price growth compounding over 5 years,
my downside is that the RNO make a mess,
and i see this as quite low risk given the skill they have demonstrated to restructure and grow through the pandemic and pre.

RO is in my top5 hldgs

Posted at 18/2/2023 13:27 by wigwammer
Last year RNO generated £19.3m of operating cash flow, net of tax and net of a £4.8m pension charge. It spent around £6m on capex, and £2m interest, leaving net free cash flow at £11.3m or a valuation multiple of 5.1x. Where's the illusion?
Posted at 08/2/2023 09:05 by 74tom
Re. the P/E multiple here, it's rather irrelevant when a company has a pension liability that is almost equal to the current market cap (£61.1m) + net debt of £34m as per the interims.

The effective enterprise value is therefore £63m + £61m + £34m = £158m, so it's trading at about 5.3x adjusted EBITDA. They paid 7.6x adjusted EBITDA for YUK, so yes it's trading at a discount to that, but that makes sense given the pension cost drag.

Out of interest I just looked at BAE Systems defined benefit pension financials & they have a surplus of £1.5b, with scheme investments comfortably covering liabilities. RNO always look to have had a significant deficit, and once in that position it's clearly very difficult (and expensive) to rectify.

Posted at 08/2/2023 07:58 by this_is_me
Last year's results showed growth and growth has continued this year yet the P/E is still going to be around 5, if not lower, at current share prices.

Seriously undervalued.

Posted at 07/2/2023 09:30 by prokartace
This share is now massively undervalued. Nothing but good news coming from the company but the share price has been totally unable to make a sustained rise. It is worth more than double the current price and that would still leave it on a single digit PER. If you consider the progress in improving margins and cutting costs over the last 5 years . I don't think institutional investors have noticed. 2018 the company had revenues of £191 million and a loss of £2.2 million. 2022 similar revenue of 195 mil and net profit of £10.2 mil
The outlook should show growth in revenue and profit. Order book including the new contract should be up over 10% this year, so in spite of inflation this company is growing

Posted at 16/11/2022 14:44 by kalai1
Renold Plc posted Interims for the HY period ended 30th September 2022 this morning. Revenue was up 22.0% to £116.3m driven by strong growth in the Chain segment. Adjusted operating profit was up 33.3% to £9.6m, return on sales increased by 80bps to 8.3% with price increases offsetting input cost and supply chain challenges. Adjusted EPS was up 42.1% to 2.7p. The balance sheet looks decent with net debt at £34.0m or 1.2x rolling 12-month EBITDA. The Group’s IAS 19 pension deficit was also reduced by 29.6% to £61.3m. The acquisition of Industrias YUK provides opportunities for synergies and further growth. Valuation also looks very attractive with forward PE ratio at 4.8x ranking RNO top out of 33 names in the Machinery, Equipment & Components sector. Share price is down about 1/3 over the past 12 months and lacks some positive momentum. Wider macro risks are an obvious potential cloud, but company specific factors suggest there is a lot to like. BUY....

...from WealthOracle


Renold share price data is direct from the London Stock Exchange
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