Spirax-sarco Engineering Share Discussion Threads

[adrunkenmarcus] 28/5/2020 22:14

SPX is expensive - but then I thought that in 2015 when I bought it and it was c. x23 earnings! Then again, there's nothing to say it can't get more expensive. Maybe it will grow into its valuation over time. Within the next eighteen months, I'm expecting my dividends received to reach about one-fifth of my book cost and I fully expect it to 'pay back' my capital in dividends over time - I'll then let it run and run...

[mach100] 28/5/2020 21:42

I hope you will have sobered up by the time you see 10 times the number of SPX shares in your PF Marcus! I suppose a share split might make the swings less pronounced as SPX has been between £89, £81 and £73 during my purchases. £100 was imo always going to be a psychological selling trigger point for some investors. I am hanging on for £105 myself as at least the dividend is retained and covered. SPX actually held above £100 at the close but might fall under tomorrow as the Dow faded into the close and US v China tensions may be to the fore over the weekend. But I like SPX and its niche market so may sell 50% only at £105 or £10.50 in a share split.

[adrunkenmarcus] 28/5/2020 21:04

We may not see £100 again for a while - not necessarily because it's got ahead of itself in valuation, but because they may do a share split. I think they split back in the 1990s when it was trading in the £90s - not that this means they'll do so again, but it's possible. They could do a 10-for-1 share split and we'd have a neat £10 share price.

[kirkie001] 28/5/2020 15:52

Well - there's £100 - albeit briefly!

Whilst I'm happy that I still hold 50% of my original investment here and that the price is going great guns, I'm finding it a little hard to justify on fundamental grounds, and think it's got ahead of itself.

Still - as the saying goes, now that I've sold 50% at more than 100% profit, I'm playing with house money....

[adrunkenmarcus] 27/5/2020 20:52

£100 wouldn't surprise me and, I think, Berenberg had a £105.40 target price on SPX before the current crisis all kicked off.

[mach100] 23/5/2020 16:00

I think we will ghave £100+ shortly. Quite a few sell on the news investors are out. The divi is safe. No Covid 19 skeletons likely and has put the right measures in place to emerge quickly from the crisis when a semblance of normality comes. SPX just needs to break out of the 8900p range to 9500p which it has been rather in than out of most recently.

[adrunkenmarcus] 23/5/2020 13:05

ntv,

I don't think they did. I think the issue is that, for every £1 they lose in revenue, they expect to lose 45p from profits, because they can take other actions on the cost front.

For what it's worth, earnings per share forecasts are showing down 8.5% for 2020, up 11.6% for 2021 and up 6.4% for 2022. They have also maintained the dividend and it's forecast to grow very slightly for 2020. Even for 2020, that covers the dividend comfortably.

At yesterday's prices, SPX had more than trebled for me since 2015 and that ignores dividends, which have compounded c. 12% pa since purchase and included a special.

[ntv] 21/5/2020 14:11

SAW
Why is this going up when they said profits were going to fall 45%?

[philanderer] 14/5/2020 10:36

Risks outweigh rewards at Spirax, says Shore Capital


The risks for engineering group Spirax-Sarco (SPX) are greater than the market perceives, according to Shore Capital.

Analyst Tom Fraine retained his ‘sell’ recommendation on the shares, which rose 4.5% to £96.74 yesterday.

He said the group’s main problem was its inability to visit customers’ sites but it has also suffered from disappointing trading updates from its industrial peers.

‘We think the risks the company faces may be greater than the market perceives as only around half of its revenue is driven by defensive markets and although 50% of Spirax’s revenue is driven by small £1,000-£2,000 tasks, its growth is still dependent on increased industrial production,’ he said.

‘We believe the risks associated with Spirax materially outweigh the potential rewards.’

[kirkie001] 13/5/2020 15:26

It's very well written!
I unloaded half just below £96 - will reinvest them if the price dips below about £88, although i'm simultaneously looking for other places to invest - 5% yield, low debt and decent capital growth opportunities, please!

[philanderer] 13/5/2020 14:23

That's one hell of a good update :-)

[kirkie001] 13/5/2020 10:23

Am I wrong to think that hitting an all-time high on the strength of today's trading update is a little racy??

Can't quite bring myself to sell, though, as I've held for so long....

[philanderer] 28/4/2020 14:49

28th april HSBC 'hold' .........tp 8110p up from 7770p

[philanderer] 21/4/2020 00:06

Yes , and xd thursday morning for the 78p dividend.

[the white house] 15/4/2020 09:57

Engineering first to come out of the blocks after lockdown, increased dividend, big exposure to China which is back on track and shares moving ahead...

[philanderer] 14/4/2020 10:04

Downgrade by Jefferies to UNDERPERFORM. TP. 7310p

[philanderer] 31/3/2020 10:15

Shore Capital downgrades ‘too optimistic’ Spirax-Sarco


Shore Capital has downgraded engineering group Spirax-Sarco (SPX) after Covid-19 hit revenues and earnings per share ‘far more’ than was implied.

Analyst Tom Fraine downgraded his recommendation from ‘buy’ to ‘sell’ on the shares, which closed at £79.02 yesterday.

He cut his revenue estimates by 15% and 11% for 2020 and 2021, respectively, and earnings per share by 31% and 22%, which is ‘far more than that implied by the company’ in its March guidance, which was ‘far too optimistic’.

‘The shares are currently trading at a similar level to when the guidance was given, but we think the outlook has deteriorated significantly,’ said Fraine.

‘In particular, we highlight the difficulties Spirax is likely to be facing given the restrictions on visiting customers’ sites. Spirax’s sales engineers providing on-site steam management and thermal energy solutions is central to the group’s business model.’

[philanderer] 26/3/2020 12:10

Down today...


Spirax-Sarco Engineering, down 5.1%. Berenberg downgraded the valves and pumps maker to Hold from Buy.

[ntv] 17/3/2020 15:57

Why is this going up so much?
Must be a leak of news to the privy few

[philanderer] 17/3/2020 15:35

Amaxing share price performance in these uncertain times.

[apad] 13/3/2020 09:51

I've been trying to find out the name of the 'small acquisition' that is likely to be game changing for Watson-Marlow.
Failed!
apad

[philanderer] 12/3/2020 10:34

Analyst presentation

[adrunkenmarcus] 11/3/2020 21:34

Another 10% dividend increase and a dividend which has grown 11% CAGR over 52 years.

[philanderer] 11/3/2020 20:34

Bad day to report.

Peel Hunt reiterates 'add'