Renold Share Discussion Threads

[kalai1] 16/11/2022 14:44

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

hxxps://wealthoracle.co.uk/detailed-result-full/RNO/620

[jaf111] 16/11/2022 13:04

Hard to disagree with you prokartace…..
Mr Market can be a very hard taskmaster but I think he has got it wrong here.
So a little more patience required

[prokartace] 16/11/2022 12:56

Sensationally cheap. Lets hope the aquisitions work well. If they do then debt will decine quickly. It is not unmanageable at 1.2x EBITDA. This should decline to below 1x EBITDA by the time of the annual results as EBITDA will increase and profit will increase allowing a reduction in debt of around £5m.
This share is seriously undervalued and is worth at least double the price it currently trades at. It is astonishing that with all the good figures and upgrades throughout the year that this share has fallen 25% in the last year!

[this_is_me] 16/11/2022 09:41

Huge two way trade already today.

I have a small investment here, bought 6 months ago, still slightly underwater, which I may double.

[bubloo] 16/11/2022 09:31

trading at pe of less than 4.5 with possible dividend next year.second half seasonally better with inventories probably unwinding as logistics are getting better and Germany has managed its energy supplies well.
with high interest rates pension fund deficit will disappear very soon. I twas if I remember right close to 124 million about 1.5 years ago and now around 60 million

[jailbird] 16/11/2022 07:56

Yes increase in debt because of acquisition- not great Pension deficit down - good If acquisition is revenue /profit enhancing next year , then will pay for itself Neutral for me for now , but uplift in revenues next year

[jaf111] 16/11/2022 07:21

Looks more than satisfactory…..hopefully Mr Market agrees !!!

[this_is_me] 16/11/2022 07:19

" The strong trading momentum experienced in the second half of the last financial year has continued in the first half..."

"Order books as at 30 September 2022 of GBP99.0m again represent a record high for the Group, and are 37.3% higher than the prior year equivalent; 24.3% at constant exchange rates."

There was never going to be a dividend having spent EUR £20 million on the acquisition and still with a huge pension deficit albeit this having reduced by 30% in accounting terms.

[retsius] 15/11/2022 12:43

Quite a bit of excitement before tomorrow!

[jaf111] 14/11/2022 14:05

Very doubtful about an interim divi but possibly they could hint at a return to a divi if the ‘strong momentum” reported in the Sept update continues for the remainder of the year…..

[coolen] 14/11/2022 13:09

Needs to return to the dividend list from its recently reported "strong cash generation". Er....when was the last dividend ?

[jaf111] 14/11/2022 11:11

Interim results on Wednesday…..🤞🤞9310;

[hardupfedup] 14/11/2022 11:00

moving up slowly

[petewy] 05/11/2022 18:24

It's not "no interest," it's no news to comment on.

[retsius] 05/11/2022 07:47

No interest in this stock by the punters.

High sales yesterday.

Rather strange, given managements upbeat guidance.

[interceptor2] 06/9/2022 09:58

Agree the update is rather positive, Interims will be interesting in November. Have an initial small holding here and might add some before Interims on likely general market weakness.

[this_is_me] 06/9/2022 08:31

A very positive trading update making the company look even more seriously undervalued.

[tole] 10/8/2022 19:31

https://www.fool.co.uk/2022/08/10/should-i-buy-this-dirt-cheap-penny-stock-for-growth-and-returns/Should I buy this dirt-cheap penny stock for growth and returns?This Fool delves deeper into a penny stock that could be primed to grow and provide lucrative returns in the long term.Jabran Khan?Published 10 August, 4:45 pm BSTRNOMiddle-aged white man wearing glasses, staring into space over the top of his laptop in a coffee shopImage source: Getty ImagesIdentifying the best penny shares that could go from diamonds in the rough to a lucrative stock providing consistent returns is a key part of my investment strategy. One penny stock I am currently considering is Renold (LSE:RNO). Should I buy the shares for my holdings? Lets consider the pros and cons to help me decide.Industrial chainsAs a quick introduction, Renold is a UK-based manufacturer of industrial conveyor chains as well as other machine components. With a worldwide presence, it serves many industries including but not limited to agriculture, construction, energy, and mining.It is worth remembering that a penny stock is one that trades for less than £1. At current levels, Renold shares are trading for 24p. At this time last year, the stock was trading for 19p, which is to a 26% return over a 12-month period.To buy or not to buy?So what are the pros and cons of my buying Renold shares?FOR: I'm buoyed by Renold's history, presence, and profile, especially as a penny stock. The business has history stretching back to the 1800s and has impressively grown into a worldwide business. In fact, it derives most of its revenue from the Americas, and also serves the Chinese market too. Another plus point for me as a potential investor is that Renold has diversified its business model through offering a number of different flagship products. All of these products have multiple applications across a wide range of industries. This diversification could help boost performance and potential returns over time.AGAINST: Current macroeconomic headwinds could pose a real threat to Renold's growth and performance. Soaring inflation, the rising cost of raw materials, as well as the supply chain crisis could all have an impact. Rising costs could affect profit margins. Supply chain issues could have an impact on operations too. This is something I will keep a close eye on.FOR: At current levels, Renold shares look dirt-cheap on a price-to-earnings ratio of just five. If I were to open a small position in the penny stock, I would not be risking too much of my cash.AGAINST: One thing I did note from recent trading updates provided by Renold was the absence of a dividend. It said it is anticipating cost challenges linked to the macroeconomic headwinds noted above. Furthermore, it is investing cash in streamlining processes and working practices to support longer-term growth. I do believe Renold could pay dividends at some point in the future, however.A penny stock I would buyTaking into account the pros and cons, I would be willing to add a small number of Renold shares to my holdings. The shares look cheap, so I wouldn't be risking too much money. Furthermore, city analysts are upbeat on the company's earnings growth expectations in the coming years too. I believe Renold shares could provide stable returns in the long term as the business continues to grow.

[this_is_me] 04/8/2022 07:12

That looks like a really good acquisition and it seems that there are other possible ones in the pipeline.

[davebowler] 22/7/2022 14:25

IC mention this week -

Broker Peel Hunt expects adjusted earnings per share to be flat over the next 12 months. Although the size of its order book increased and it has so far managed to pass through higher costs to customers, both supply chain challenges and inflation levels remain elevated. For Renold, the latter could actually be useful in terms of its pension liabilities if bond yields continue to climb. We upgrade to hold from sell on the back of its improving financial position, even if the prospects for its end markets remain uncertain.

[rburtn] 18/7/2022 05:48

My take on Renold is not good for the P.I. who, thanks to this country's version of democracy and adversarial system of justice is powerless to set matters aright and can only just walk away if he doesn't like it.

In the last four years, Renold has retained 27m profit, more than half its market cap!, yet that market cap remains stuck, even less, that it was before all this 're-invested' capital was applied.

There can only be a few explanations.

a) the money has been embezzled

b) it has been frittered away on purchases from possibly connected interests to no purpose whatsoever

c) the directors are a disaster on making investment decisions

d) the old scapegoat - pension deficit. Given that all pension schemes operate to the same rules that for an oily rag workforce must be in surplus compared with a bureaucracy and it should be big.

e) the market has got it all wrong.

Take your choice but for me, this company is for trading, not one in which you would invest.

[ga_dti] 14/7/2022 10:10

Latest CEO interview with DirectorsTalk talking through the results highlights, what's driven revenue and profit growth, record order-book and ‘STEP 2’ -

[tiswas] 13/7/2022 17:59

interceptor2

You are quite right, no new news, but I still think that if some financial whizzkids can sort out the pension then this is a sitting duck for a t/o.