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SYNT Synthomer Plc

180.90
-1.60 (-0.88%)
08 Dec 2023 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Synthomer Plc LSE:SYNT London Ordinary Share GB00BNTVWJ75 ORD 1P
  Price Change % Change Share Price Shares Traded Last Trade
  -1.60 -0.88% 180.90 319,925 16:35:13
Bid Price Offer Price High Price Low Price Open Price
181.00 184.90 183.90 174.70 182.50
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
Chemicals & Chem Preps, Nec 2.59B -32.5M -0.1987 -9.11 296.22M
Last Trade Time Trade Type Trade Size Trade Price Currency
18:10:43 O 662 180.90 GBX

Synthomer (SYNT) Latest News

Synthomer (SYNT) Discussions and Chat

Synthomer Forums and Chat

Date Time Title Posts
08/12/202311:26Synthomer1,537
07/8/201818:23Synthomer (SYNT) One to Watch on Monday 1

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Synthomer (SYNT) Most Recent Trades

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Synthomer (SYNT) Top Chat Posts

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Posted at 10/12/2023 08:20 by Synthomer Daily Update
Synthomer Plc is listed in the Chemicals & Chem Preps, Nec sector of the London Stock Exchange with ticker SYNT. The last closing price for Synthomer was 182.50p.
Synthomer currently has 163,567,621 shares in issue. The market capitalisation of Synthomer is £296,220,962.
Synthomer has a price to earnings ratio (PE ratio) of -9.11.
This morning SYNT shares opened at 182.50p
Posted at 27/11/2023 22:40 by darrin1471
wigwammer. Thanks for the heads up on McBride 18 months ago. Last months rise makes it my biggest holding. I continue to hold MCB as I see further upside in re-valuation and even higher profits.

I've had SYNT on a watch list for a few months and now the dust has settled I have taken a deeper look and I quite like the look of what I see.
The strategy of a specialist chemicals company looks sound. The price SYNT paid for Omnova and Eastman’s Adhesive Resins looks reasonable.
The Eastman’s timing is unfortunate but at the time of the acquisition (28/10/2021) BofE rates were 0.1%, we were exiting covid and the SYNT share price was near all time highs.
The sale of non core business and the return of normal trading conditions should lead to a significant recovery.
I hold no position in SYNT at the moment.
Posted at 23/11/2023 22:23 by wigwammer
Ah. So the EV is not "north of a billion" at all. Thought not and thanks for correcting... In reverse order - of course, the enterprise value of the company is higher than its market value. Nobody stated otherwise and it is true of all company's with net debt. But 0.4x EV:Sales puts SYNT amongst the lowest valued majors in the sector. Your negativity is highly consensual and may well be priced in... Nobody stated that trading "within expectations" would result in price appreciation, in fact when meeting expectations one should expect little price reaction at all... Poor management has been a disaster, I suspect their hands are now tied by lenders. If you don't understand why this can be favourable for leveraged companies - take a look at McBride over the last 12 months... And I think me and WB will be taking "the moat" and you can keep your superstar management... "When a management with a reputation for brilliance tackles a business with a reputation for poor fundamental economics, it is the reputation of the business that remains intact". ATB
Posted at 23/11/2023 21:41 by al101uk
EV=Market Cap+Total Debt-Cash

At interims, they had cash of £232 million
They had Debt of £995 million
Plus £74 million of pension liabilities
and they currently have a market cap of £330 million

I made that north of a billion.

The rights issue has reduced that below a billion since then, so lets adjust that to £880 million. I dumped my shares a while ago so I'm not following as closely as I might and when I saw the £200 million plus payment of debt in the results I put it down to the placing rather than the disposal and didn't look any further. It changes very little.

That's £880 million of enterprise value for a company that had revenue of £1 billion in H1 and managed £49 milion of operating free cashflow. The company is "washing it's face" with share holder cash, it's certainly not throwing off cash at an operating level.

In the companies own words the placing was to stave off a situation where they breached their debt covenants (read the going concern notes in the H1 results), that's hardly the sign of a great business and my point was that the company has a long road to travel before it gets back on it's feet and it needs good to great management to get there imv. There is no evidence that management are up to the task right now.

I've responded to your criticisms of my post, care to respond to any of mine?

To summarise:

1. You didn't take WB's comments in context.
2. Poor management in Synthomer would be a disaster for the business.
3. Trading "within expected boundaries" doesn't warrant share price appreciation given what those boundaries are.
4. Synthomers valuation is far higher than it's market cap.

and I'll throw in:

5. Having creditors breathing down your neck is not a positive for a business trying to restructure.
Posted at 23/11/2023 10:56 by wigwammer
The low trading volumes are remarkable for a company the size of Synthomer - with £2.2bn+ revenues. Rather reminiscent of pre RI days, large uncrossing sell trades each day after the bell. It is almost as if institutional buyers have gone on strike. Why might that be? Is it that ONCE AGAIN Synthomer have poorly communicated with the market at large? Certainly for a company that claims that trading is within expected boundaries, the resulting drop in price is rather hard to fathom.
Posted at 06/11/2023 14:42 by darrin1471
ham: from your sharecast link:
"Synthomer was a classic early cycle share"
"weaker volume outlook in 2024 for the construction-and-coatings linked component of sales."

About 40% of SYNT revenue comes from coatings & construction solutions. IMO this cycle is different from the GFC as interest rates were slashed during the GFC and today we are only just entering a period of "for higher and longer" interest rates. If the narrative remains higher and longer then construction still has a way to fall and the cycle has several years before it turns.
Posted at 07/9/2023 11:24 by darrin1471
If I bought 10,000 shares today at 42p it would cost me £4200.
Consolidation of share 20 to 1 would leave me with 500 shares worth £8.40 and the total value would remain £4200
6:1 rights issue at £1.97 would mean I could buy (6 x 500) 3000 at £1.97 costing £5910
I would end up with 3500 shares costing £10,110.

Current shares in issue 467m x 42p share price is a mkt cap of £200m
467m shares consolidated at a rate of 20:1 would be 23.35m
23.35 x 6:1 rights issue would be 140m new shares issued as per announcement

As of 8am 26/09/23 shares will be consolidated 20:1. I will end up with 500 shares trading at £8.40 (current price 42p x 20)
If I still hold shares at the close of business of 26/09/23 I will be entitled to the 6:1 rights issue.
On opening on 27/09/2023 share price will fall to £2.88. (((£1.97 x6) + £8.40)/7)
I would have 3500 at £2.88 = £10,800

Valuation would obviously change with share price

I am not in my comfort zone here. Does that sound right?
Posted at 07/9/2023 07:58 by muzmanoz
Theoretical ex rights price of 17.1p Surprised share price is still at this level. surprised share price is still at this level.

Rights issue is at an 83% discount to yesterdays close.
Posted at 16/5/2023 10:05 by al101uk
Cyclical company and the cycle changed, that was compounded by a bad purchase at the top of the market. I think it'll be a while before we see £3 again, trading conditions need to improve and debt needs to be reduced. It's a long way back from here.

On the positive side, things should start to improve over the next 12 months and once we start seeing that improvement we should see a corresponding move in the share price. Given the company has been valued at £5 in the good times (albeit with fewer shares in issue), it's not impossible that we see a much higher share price from here in a year or two.

Not buying more at the moment, but happy to sit on the shares I have. Barring another calamity I think we're at or close to the lows.
Posted at 17/4/2023 05:38 by tole
https://citywire.com/funds-insider/news/expert-view-travis-perkins-foresight-synthomer-norcros-and-devolver/Berenberg: Synthomer is cheap whichever way you lookChemicals group Synthomer (SYNT) may have had a tough 2022 but Berenberg says end-markets have troughed and there is recovery potential.Analyst Sebastian Bray retained his 'buy' recommendation but reduced the target price from 170p to 150p on the stock, which gained 1%, or 1.3p, to 123.1p on Friday.He said full-year 2022 results were 'weak and highlighted operational issues with acquired Eastman assets, but indications are that end-markets have troughed', and the company can rely on its 'valuation margin of safety to absorb downgrades'.'It says much about the inexpensiveness of shares in Synthomer that we can halve our earnings per share estimates after a lacklustre trading update and still be left with a comfortable margin of safety,' said Bray.'Our two-year price/earnings and free cashflow yield of nine times and 11%, respectively, are at the cheaper end of the chemicals sector.'He said the shares could become even cheaper if he is correct in his forecast for nitrile latex earnings to return to the £55m the division made in 2019.'Our base case is £21m in 2025, owing to long-term pressure imposed by additional Chinese supply; however, commodity chemicals prices have a habit of overshooting expectations, in both directions, and in a "recovery to the normal" scenario, we estimate the price/earnings would be six times and the free cashflow yield 16-40% cheaper than historical averages.'
Posted at 07/8/2022 15:47 by jonwig
This is the IC tip, from Friday (at 211p):

Synthomer (SYNT) is an example of how short-sighted the stock market can be. Demand for PPE during the pandemic turbo-charged performance elastomers (PE) sales. Synthomer's share price almost doubled. Now PE sales are back to pre-pandemic levels, the share price has almost halved, so we are back to where we started.

The difference between now and before the pandemic is inflation. The cash profit (Ebitda) margin dropped from 26.2 per cent to 13.0 per cent. The need to stockpile raw materials to mitigate against supply chain disruption has also tied up more working capital in the business. Free cash has therefore swung from an inflow of £89.5mn last year to an outflow of £62mn.

The combination of the cash outflow and the £759mn acquisition of Eastman’s Adhesive Resins means net debt has risen to £993mn from £355mn. This acquisition enabled the business to launch a new Adhesive Technology division that generated £131mn of revenue last year. This will diversify the business, and Synthomer insists that adhesives is a higher growth segment.

If the investment in Adhesive Technology is a success, then the business will be a better place leaving the pandemic than going in. Cash profit of £173mn is 74 per cent higher than the same period in 2019. The fact the share price sits around half its 2019 level is rather indicative of the global economic slowdown and Synthomer's increased debt.

FactSet consensus expects earnings to rise to 39p in 2023 which gives a very affordable 2023 PE ratio of five. Earnings aren’t going to race forward, but at these prices there looks to be value here. Buy.

I don't hold, but the share price seems weird!
Synthomer share price data is direct from the London Stock Exchange

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