Sureserve Share Discussion Threads

[rivaldo] 30/1/2023 08:41

SUR remain extremely cheap on current fundamentals, let alone if they announce a highly earnings-enhancing acquisition from their cash pile or announce the completion of sales of the non-core businesses.

INSE's results today prove that the stock market often just simply gets it wrong. I'm confident that this is just a hiatus whilst the market finishes taking profits from the rise in the last 2-3 years and gets back to re-rating the shares.

The current share price is a bargain opportunity imho on a P/E of 9 or so.

SUR have now highlighted the £19m 5-year contract win from Great Places Housing Group for "gas servicing, maintenance and boiler installations":



"27 Jan 2023

Sure Maintenance has secured a five-year contract with Great Places to continue carrying out gas servicing, maintenance and boiler installations. Worth in the region of £19m over five years, the new contract will commence on 1st April 2023.

etc"

[knowhow77] 29/1/2023 12:36

Vfast good to see you back on the board and as per usual patience is required with sureserve

[vfast] 29/1/2023 10:23

HK77

I've decided to sit on the side lines now, however I still note the content on the BB. Also my other investment has been taken my attention as there is a lot happening within that business.

The results are good which they have been over the last 24 / 30 months however the share price appears to hit resistance at the 90p level which I think we all believe undervalues the company.

Rivaldo is a great source of good information and agree with his overall assessment.

The share price must kick on at some point but I've given up trying to predict any time scale.

May be the City, II's and PI's are all a were that it is a rock solid company with predictable results but what we need is something exciting which will spark life back into the share price and attract interest which appears to be missing.

[johndoe23] 27/1/2023 14:09

One thing I've noticed post results here in thr past, it can take a week or two before the share price reacts. Hopefully the same again

[knowhow77] 27/1/2023 13:43

Seems to be mainly selling since the results came out but the share price holding steady just hope the board have some positive news sooner rather than later

[gswredland] 27/1/2023 11:32

Good to see.Thanks Rivaldo

[rivaldo] 27/1/2023 10:03

The IC says Buy:



"Gas business heats up Sureserve’s prospects

Longer contracts offer greater visibility over revenue, CEO says

January 24, 2023

Sureserve’s (SUR) shift towards focusing on providing energy services to social housing landlords was fortuitously timed, given the greater focus on tackling fuel poverty following Russia’s invasion of Ukraine.

The company now installs and maintains gas heating, smart meters and renewable energy systems. The gas division continues to bring in most work, though, and the
average contract length has increased from five to six years, providing greater revenue visibility, chief executive Peter Smith said.

Its order book grew by 18 per cent to around £594mn at the year-end and it had 93 per cent of this year’s expected revenue secured as of 1 January. More than 90 per cent of gas contracts are also index-linked, providing protection against rising costs. Sureserve's cash profit margin widened from 5.7 per cent to 6.1 per cent.

The company has cash in the bank, but opted not to pay a dividend for the second year in a row, keeping its powder dry for acquisitions. Smith acknowledged this hadn’t played well with retail investors, but said he was “very clear why we’re
doing that” and that he had the backing of institutions.

Its M&A activity has been slower than anticipated – it changed advisers last year and deals were harder to complete due to a gap between buyer and seller expectations. It has faced the same issue with the two businesses it is selling – Sureserve Fire & Electrical and Precision Lift Services. It recorded a £3.5mn goodwill impairment against the carrying value of the lift business based on the value of offers received.

Broker Peel Hunt lifted its earnings per share estimate by 7 per cent to 9.3p. The shares trade at just over nine times this level, well below peers. Buy."

[angersharkz] 26/1/2023 12:57

Hsmith08 - I take it you do understand how the stock market works? And that economies go through cycles? And that we’re STILL currently in a bear market?

Risk appetite for stocks is low. When the market is down, everything stays down….even more so with small caps like SUR. Why would the share price surge when there’s 40 year high inflation and a war in Europe?

The price ‘hasn’t gone anywhere’ for 2 years for that very reason. 2 years in investing is nothing. Now is the time to be buying stocks like this when everyone else is fearful. If you don’t understand this very simple fact I’d probably suggest selling up and buying a lottery ticket perhaps?

I’m not sure investing is for you?

[knowhow77] 26/1/2023 10:27

Where’s Vfast would like to know his thoughts on these latest results and forecasts

[hsmith_08] 26/1/2023 10:20

Rivaldo can you explain to me why time and time again after good results nothing happens with the share price? And when do you think it will rise then? All sounds good seeing tips and forecasts for the future but it hasn’t moved for 2 years and looks to have fallen flat again as usual like I said in my previous comment on results day!

[rivaldo] 26/1/2023 07:43

Cheers - good to see MWM raise his target price to 120p and above:

Here's a direct link:

[gargoyle2] 25/1/2023 17:42

masterinvestor.co.uk/equities/sureserve-group-time-to-reassess-after-results/?mc_cid=956b3d8607&mc_eid=6383a93a69

[angersharkz] 25/1/2023 15:13

Knowhow77 - I don’t worry about what the share price does in the short term……I’m quite happy to let management focus on delivering growth and keep delivering impressive numbers like we received yesterday.

Everything else will look after itself.

[knowhow77] 25/1/2023 14:59

Yeah let’s not carried away and break the £1 barrier first

[angersharkz] 25/1/2023 14:10

Yes, that ends the dividend debate (not that you would have invested for one here in the first place) so all those that are holding on to the hope of receiving one can adjust their portfolios accordingly…….ie sell up.

Rather than short term divi’s at 1p…..I’d be much happier if in 2-3 years time the company has continued to grow organically, added a cash accretive acquisition and potentially paying dividends 5p or more??

[rivaldo] 25/1/2023 13:47

Cheers igoe104 (perhaps get rid of the long link as it's warping the page?!)..

Capital Access have consensus forecasts for the entire business of 8.95p EPS this year - a P/E of only 9.8. Far too cheap.

Capital's numbers in their note are all over the place. The P&L numbers on page 5 are "continuing only" for last year and "entire business" for the current year. And on the front page they say the year end is December!

There's an interesting section on the dividend, noting it's "unlikely to return" in the near future. There are "active live discussions" with acquisition targets and the sales of the non-core divisions are "progressing". The dividend debate would now seem to be pointless as it's a non-issue - it ain't happening!

Personally I'm very relaxed about this. If and when SUR announce a decent-sized acquisition I suspect its effect on the share price and rating will be far greater than that of a dividend which could instead be used to supplement growth.

[igoe104] 25/1/2023 11:55

Detailed note from capital.

shorturl.at/osBM3

[rivaldo] 25/1/2023 10:48

Nice to see some coverage for little ol' SUR in the Times market report today:



"A positive set of results from Sureserve, which said strong trading momentum had flowed into the present year, pushed shares in the social housing energy provider up 3p, or 3.6 per cent, to 87½p."

[knowhow77] 25/1/2023 10:18

Despite good results and not for the first time the share price has done very little over the last 2 years even when they have made an aquisition [ Cor energy } so there is no guarantee that the next one will change anything what is holding this back?

[hsmith_08] 25/1/2023 10:04

Shock after my comment yesterday about it going flat again… only 5 trades so far and all sells!

[thelongandtheshortandthetall] 25/1/2023 09:09

And the solid, near risk free, long term nature of the income.

[thorpematt] 24/1/2023 22:25

rivaldo, shauney,
Many thanks for you inputs. That all makes sense.

On valuation, FWIW I always make a valuation calculation for my long term holds (Trades not so much).

When I do so, I always take into consideration net debt and net cash. In a rising rate environment I think net cash is a very useful concept indeed.

Once we take the cash into consideration this trades off a very modest valuation, especially considering the growth potential in the sector.

[gswredland] 24/1/2023 18:17

Thanks shauney

[shauney2] 24/1/2023 18:03

From the IC,Broker Peel Hunt lifted its earnings per share estimate by 7 per cent to 9.3p. The shares trade at just over nine times this level, well below peers. Buy.Last IC View: Buy, 87p, 25 Aug 2022htTps://www.investorschronicle.co.uk/news/2023/01/24/gas-business-heats-up-sureserve-s-prospects/