Ricardo Share Discussion Threads

[tenapen] 20/11/2024 20:10

We had the results October 11th followed by an Investor Meets presentation a week or so later. No mention of the proposed sale. Circa six weeks later they issue the proposed sale RNS. Four weeks on and silence. It must be Me !.

As for the share price - I have my holding no more and no less - see where the future takes me.

[norbert colon] 20/11/2024 19:51

Why is it hard to fathom? When they set out their strategy a couple of years ago it was to move away from capex heavy / low margin work (and I'd imagine they would like to have less manufacturing (if any) to make them a more pure-play consultant / advisory biz.Whilst defense margins (currently) aren't small, the planned divestment aligns with those strategy and so it shouldn't be a surprise - at least not too investors who've been here more than 2 yrs.The current buoyant defense market would seem to be a good backdrop into which to sell their defense biz and if it's going through a competitive process it won't happen overnight.That's said, I'm equally as frustrated as anyone re: the valuation.

[tenapen] 20/11/2024 17:52

The above RNS about the possible sale of the defence business was / is hard to fathom. One month later we still await any news of the sale and for how much.

They take home the big bucks and have a plan !.

[spooky] 20/11/2024 10:52

You would probably have made more money doing the reverse of his recommendations on this stock. He doesn't have a great record. Tipped them as a buy at the end of September this year.

[1968jon] 20/11/2024 09:30

I have just seen the sell comment from Questor in the Telegraph from yesterday. Reasonable rationale for a whatever it is that Questor is.

[tenapen] 14/11/2024 18:31

Hi Indiestu, everyone.

Big bad donald casts a dark cloud over the clean tech sector. Hopefully Ricardo and the UK can look east for growth !.

Regards.

[tenapen] 14/11/2024 18:25

Website updated



Ricardo’s hydrogen fuel cell module celebrates key milestone to successfully generating power
14 Nov 2024

Cont...

Ricardo will soon be releasing a video series where will will share more about our fuel cell module. Sign up to our mailing list

[tenapen] 07/11/2024 16:40

Ricardo announces launch of Element modular transmission range for decarbonised propulsion systems

[indiestu] 07/11/2024 10:37

Seems we are back in the game ten. UK government pushing the agenda for 100% clean energy generation by 2030. The sector is heating up.

[tenapen] 25/10/2024 13:59

My wobble is over - the big boys and girls must have looked and crunched the numbers and like what they see in the possible disposable!.

Regards

[indiestu] 22/10/2024 14:03

UK doing good.

[indiestu] 22/10/2024 13:12

Stay positive ten. UK small caps are weak across the board and industrials in particular. Its market macro and not news related. Budget on the 30th and BOE interest rate decision on the 7th so getting these uncertainties out of the way should help. I'm seeing some signs of life in the clean energy sector (Siemens Energy for example). If the Ricardo board pulls off a cunning acquisition and the market wakes up to their energy transition strategy we could be riding up the next clean energy growth cycle and blowing out all the historic Ricardo highs. Consulting and digital products - high margin quality earnings, EPS like we have never seen from Ricardo. No risk no gain, no pain no gain. Fortune favours the brave, change is good.

[dexdringle] 22/10/2024 12:12

Go woke, go broke.

[tenapen] 22/10/2024 11:19

Groan - didn't take much to destroy an already weak share price. Do these people know what Thier doing.

Strategy Update my .......

[indiestu] 21/10/2024 11:10

I'm not sure the reason behind wanting to sell. If you were unhappy with the strategic direction the company was taking you would have sold two years ago. They are now doing exactly what they said they were going to do in the timeframe that maximises value for all shareholders. Surely the correct move is to wait for the news of the acquisition and disposal and then base your decision on whether you feel the strategy will succeed. Talk about being behind the curve. For me it's time to buy as they are fulfilling the promise that they made. Each to their own I guess.

[jaynesdad] 21/10/2024 10:51

Thanks for the reply.
As I write this the early excitement has gone and the share price now negative. Sadly Ricardo has now subconsciously moved to my mental sell list. Wonder if Harry Ricardo would be happy with the company now?

[1968jon] 21/10/2024 09:48

It is a question I discuss frequently JaynesDad! Knowing a little how investment banks and PE firms work - with the caveat that Investec Securities and most particularly Libs as corporate brokers are probably not the best connected - I would be absolutely amazed if a number of PE firms were not aware of Ricardo as an idea.

UK listed stocks have been unloved on a relative basis for years and, as I have said before, for smallish caps they would be much better in private hands.

So why? I don't know. I have wondered why one of the large car companies hasn't taken them out over the last ten+ years - a long time before they went all green? I speculate and have suggested it to people that there has been an unmentioned acceptance that none of them would do on the basis that RCDO has done work for so many of them over the years? Dunno?

They are involved with the UK and most particularly the US military. Does this make it slightly more challenging from an execution point of view? I don't know? Given the fact the price would only be a few hundred million, the buyer is unlikely to be a mega fund so may lack the personnel/contacts to make it easier? They must have so much sensitive IP - it might be seen as a strategic player?

Maybe if they sell the bit in the RNS today, the remainder becomes easier?

[jaynesdad] 21/10/2024 08:44

Begs the question 1968jon, why doesn't anyone take over RCDO and sell the pieces then? I don't see anyone queuing up to do so. I also have an irrational fondness for RCDO but my passion is waning.

[1968jon] 21/10/2024 07:53

My initial thoughts....

Strangely garbled might sell, might not language of the RNS - did it need an RNS.

I have an irrational fondness for Ricardo and think it is hilariously undervalued, so consider this as extremely biased thinking.

RCDO trades on less than 6x forward EV/EBITDA for 2025. It has a ragtag bag of divisions that may/would be valued higher outside RCDO - never mind the multiples that other consultancies get. The ragtag nature in my opinion is a cause of its low rating

Military and defence companies, varying by geography are trading publicly or transacting privately at just North of 10x and probably trending higher. So potentially a decent trade for RCDO. Problem is, if you sell part of the P&L at 10+x to reinvest in something that will be marked back down to 5.5x you have a problem.

I have absolutely no doubt that if someone took RCDO out they could sell all the pieces at a nice turn. I know that RCDO know this as well.

[indiestu] 21/10/2024 07:52

The RNS appears to imply that an acquisition target has already been identified. Likely a buyer is already engaged for the defence business but no price agreed. This announcement brings it into the public domain and opens the bidding to all. The acquisition is expected to be earnings accretive. Good news. This could all be done quickly if Ricardo have a target they don't want to let slip away. For sure the management have put significant thought into this. It aligns completely with the strategy Ricardo has been communicating to shareholders for some time. For me it's an exciting time to be an investor here.

[pugugly] 21/10/2024 07:32

Market seems as though cannot make up mind - Minimal trades so far and no change in share price. - Possibly a watch and wait situation.

[tenapen] 21/10/2024 07:15

I guess they are selling at the market top ! So they should get top dollar for the company!.

We will see.

[tenapen] 21/10/2024 06:48

We agree PUGUGLY :-)

I should had listened to you regards PPS - hae ho.

[pugugly] 21/10/2024 06:41

tenapen- Could not agree more - my exact thoughts - Moving from a business they know into relatively unknown but currently fashionable territory.