Shanks Share Discussion Threads

[cerrito] 09/4/2009 08:32

From today's Telegraph
Shanks
69p -11p
Questor says BUY
Waste and recycling group Shanks has resolved the market's biggest fear. The group, which handles 2.8m tonnes of waste in the UK each year, has managed to agree a refinancing, which has eased debt concerns.
The group said on Tuesday that it had increased the size of its banking facility to €360m (£324m) from £250m. The fact that the company has not only managed to renegotiate facilities, but it has increased them significantly (by 29pc at current exchange rates) is a reassuring sign.
The facility expires in 2012 and it is provided by six banks, some of which were not involved in the previous facility. This is also gives some reassurance on the group's overall financial position.
It makes sense that the debt is euro denominated because 85pc of profits are in the single currency.
In the three-month period to March 31, trading in Shanks' Dutch hazardous waste business has remained buoyant. However, its Dutch solid waste division has seen its contribution fall, as around a third of the Dutch divisional profits come from the construction and demolition sector. This trend is likely to continue and the company has now begun a series of cost reduction activities.
In the UK, trading conditions, whilst remaining challenging, have improved from the low in November, it said. Commercial closure on its Cumbria municipal waste treatment contract is taking longer than expected, but Shanks said it was confident of closing the deal financially in the coming weeks, as talks with banks continue. This will be another positive development and the market should take this news well.
The shares are trading on a 2010 prospective earning multiple of 5.9 times, but any protracted recession could lead to further forecast downgrades. However, this valuation does not look particularly stretched. The shares have an impressive yield of 7.9pc.
Although the outlook is pretty cloudy, the rating is still quite low. The group has some long-term earnings streams and, in normal times, earnings are pretty predictable. So, with one eye on the yield, which is covered by earnings 1.8 times, Questor says buy.

[gswredland] 08/4/2009 18:46

Re trace to 50?

[cockneyrebel] 08/4/2009 17:58

took my profits today - other stuff to chase but been fun :-)

CR

[a0148009] 08/4/2009 12:40

mikke

I do not talk shares up or ramp information from Digital Look
consensus of 7 brokers.

AO

[gswredland] 08/4/2009 11:23

I think this will drift a bit now anyway...
In no hurry to get in.

[miikke] 08/4/2009 11:14

Check your facts on the financial section. According to this site dividend is only 1.46 covered at the present time; be careful about talking any share up you might cause people to lose money! Would you really want that?

[a0148009] 08/4/2009 10:13

Looks like the recent march upwards has brought out the profit takers.
Still good value.

AO

[a0148009] 08/4/2009 08:19

eps forecast 2010 13p - p/e x10 target price 120 -130p - div twice covered.
edit dividend yield 8%.

AO

[bcf203] 07/4/2009 17:15

Looks like a relief rally due to agreement on finances. Will be interesting to see what happens in the morning.
With a lot of earnings now in Euros should be a decent gain from exchange rate which can only help the profits.

[queenbreguet] 06/4/2009 09:36

CR thanks for the site.
You may wish to take a look at Afren. I am in the oil industry ,Singapore based.
They look over sold to day on Prelim results.
Outlook is positive for them compared to a lot of aim listed companies. They have a revenue flow and manageble debt to move forward.

Cheers

QB

[cockneyrebel] 03/4/2009 23:29

Yep, smashing day - in fact I've had so much going up I haven't had time to visit all the threads which is a lovely problem to have :-)

queenbreguet - I have a thread where we chat about stocks:



You are welcome to visit there, chat, lurk or whatever. Please bear in mind some of the posts there be people may be pure ramps while there are often very good leads too. Reading the thread frequently you will probably get to to see who's giving decent leads and who isn't.

I'm glad you had success here. I'm not always correct but I like to think I get far more right than wrong - tho it has to be said that's a lot easier in a market like this at the moment :-)

Best wishes.

CR

[gswredland] 03/4/2009 19:21

Well done CR!

[queenbreguet] 03/4/2009 08:51

CR I have very followed your post over a number of years and have been impressed by your comments and success. I took the plunge on these at the begining of the week and am reasonably ahead.
Any other tips.????

[cockneyrebel] 27/3/2009 19:43

Don' think so, got to have a bit of a retrace after a rise like this. Good top up point.

Lovely yield and even G.Sachs getting excited - from a couple of weeks ago.

0843 GMT [Dow Jones] Goldman Sachs upgrades Shanks Group (SKS.LN) to buy from neutral on valuation, with its 12-month price target of 148p implying 123% valuation upside. Says Shanks is trading at historically low multiples versus the wider utilities sector. Thinks the stocks is undervalued, pricing in a significantly deeper recession than the brokerage's economists foresee. Sees scope for a near-term re-rating from a successful refinancing of a GBP250M debt revolver and potential sector M&A activity. Shares +13% to 66p. (ANT)

CR

[gswredland] 27/3/2009 19:37

Not looking so good...back to sub 50?

[cockneyrebel] 24/3/2009 11:51

Breaking out from the down trend resistance line.

CR

[cockneyrebel] 23/3/2009 09:55

Look at that chart.

Now the re-shuffle is done computer says 88p on that chart isn't far off.

CR

[salpara111] 04/3/2009 13:24

Must admit that I have been watching here for some time and decided that if it ever did cross the 50p line that it would be a steal. Now here we are and I am still sitting on my hands.
The issue with the Cumbria contract is that while it is definately good news in the long term.....in the short term it will put a lot more pressure on cash flow as with any major new contract it is an expense for the first year or so until all the set up costs have been taken care of.
I guess it is possible that they may seek to raise some extra funds as they will not want to take on any more borrowing with debt at current levels.
The bottom line is that at the moment fear has the upper hand over greed.

[a0148009] 04/3/2009 09:36

You cannot count on the dividend even though it looks well covered with so much
debt. Dividends are suspect now look at BP.

[gswredland] 03/3/2009 18:18

Yes handy..i am on the sidelines looking and amazed at the share price performance! Divi must be huge at this price!

[handycam] 03/3/2009 17:09

Kicked out of the ftse 350 next week. The intelligent trackers have spotted this and the balance - they being dullards - will have to dump theirs this week and next.

So, a situation has arisen where there are forced sellers and no bid provided. Hence we have as many as you want on offer at 47pps.

This explains why we are not 100p (and the fact that the ftse 350 has lost 20% in a month). Operationally, the business seems in good shape, basically.

The question then, is is shanks half price or is it not? Is half the country on call with it? Always an interesting play to go in when everybody else is up the creek. eg, lloy 33p, rbs 10p a few weeks' ago.

[jdung] 03/3/2009 16:09

now price is 46p.
you looking trade, city boy sell then buy back,
this bad city boy, want some one to buy this share...
because no one like to buy shares at now!
waiting for ..

[jdung] 03/3/2009 11:27

FT, last 2 weeks ago, sks, pfd,dsgi, itv all need iss new shares...

[peterdavis] 03/3/2009 10:57

what newspaper

[jdung] 03/3/2009 09:17

no news? share price drop..
maybe new share iss ?(newspaper say...)