Volex Share Discussion Threads

[johndoe23] 23/1/2024 12:59

Can't read what you post I blocked you ages ago

[dr biotech] 22/1/2024 19:48

Unfortuantely MF articles are pointless. I think most are AI - this particular author has written 33 this year. Just click bait. The do about 15 articles on AV every month, and none are worth reading

[igoe104] 22/1/2024 19:13

VLX tipped here.

[igoe104] 20/1/2024 08:58

VLX should massively benefit from the growth of AI and Data centres popping up globally. Alot of cables are going to be needed....

[disc0dave46] 19/1/2024 22:10

Thanks hadn't clocked that.

[donald pond] 17/1/2024 10:29

started buying back here, the fact the Chairman is still adding (via scrip) tells me all I need to know. The tailwinds are not going to abate, it is one of a handful of high quality niche manufacturing firms on the LSE, and as soon as the market conditions start to improve will be in demand imo

[robow] 08/1/2024 10:03

from Citywire

Value at Volex after transition, says Berenberg
Volex (VLX), the manufacturer of electronic connectors, is ‘extruding value’ following a ‘remarkable transition’, says Bernenberg.

Analyst Eleanor Spencer initiated coverage with a ‘buy’ recommendation and target price of 400p on the AIM stock, which fell 8.1% to 299.5p last week. The shares are down from 313p in November when the company reported 16% growth in profits but a fall in electric car component sales.

‘Volex has undergone a remarkable transition over the past seven years from a business with high customer concentration, low margins and limited structural growth,’ she said.

‘Today, we think it has transformed into a diversified, higher-margin, structurally growing business with attractive prospects.’

Despite the opportunities at the group, it still trades at a double-digit discount to peers.

‘We think this looks unjustified and initiate coverage with a ‘buy’ rating and 400p price target. This offers 30% upside in the shares – a gap we expect will close as Volex proves its newfound strength to investors,’ said Spencer.

[ijamlon] 04/1/2024 13:29

(Alliance News) - Berenberg kicked off coverage of Volex at 'buy', hailing its "remarkable transition" in recent years.The German bank has a 400 pence price target for the Basingstoke, England-based specialist integrated manufacturer of critical power and data transmission products.Volex shares traded 0.6% higher at 308.70p each in London on Thursday morning."Volex is a leading global manufacturer of critical power solutions. In our opinion, Volex has undergone a remarkable transition over the past seven years from a business with high customer concentration, low margins and limited structural growth. Today, we think it has transformed into a diversified, higher-margin, structurally growing business with attractive prospects," Berenberg said.However, Volex still trades at a "double-digit discount to peers" something that Berenberg believes is "unjustified".Volex customers include firms in the electric vehicle end market, one that is being boosted by "strong structural drivers". Electric vehicle adoption is picking up speed."We estimate Volex's key end-markets are growing at 5-9% per annum, underpinning our forecasts for 5% per annum organic revenue growth to FY26. Further, Volex's efforts to diversify its end-markets and customer base should also yield better revenue resilience versus its history, in our view," Berenberg added.The company also has an "improved sustainable margin profile". Berenberg noted its adjusted earnings before interest and tax margin has picked up around 820 basis points since the year ended March 2014 to 9.3% at the end of financial 2023.Berenberg added: "We estimate 50% of this expansion has come from organic initiatives, such as exiting unprofitable contracts and developing new products in-house, which suggests the gains are structurally sustainable. The remainder has come from acquisitions of higher-margin companies. At 9.3%, Volex's margins are now 20bp higher than the average of our global cable manufacturing peers and have substantially closed the gap to our UK electro-components peers."Volex could also enjoy a double-digit earnings per share improvement through M&A moves, Berenberg predicted, nothing the "acquisitive" firm has already forked out GBP385 million on deals since financial 2019."We think Volex looks well positioned to complete future accretive M&A," Berenberg added.

[zho] 04/1/2024 10:41

Berenberg starts Volex with 'buy' - price target 400 pence

[johndoe23] 03/1/2024 14:15

Filling the gap back down to 300p

[johndoe23] 14/12/2023 19:55

First time in a while no icebergs on the order book

[foreverbull] 14/12/2023 16:42

Nice rise today ... hope it'll stay there and continue the momentum

[igoe104] 11/12/2023 19:18

VLX talked about from this fund manager.

[eagle eye] 08/12/2023 10:48

No I'm not, but I do follow what it does!

[strollingmolby] 08/12/2023 08:04

eagle eye - are you invested in Eagle Eye (EYE)??

[eagle eye] 08/12/2023 07:56

The Telegraph needs to protect readers from themselves, so hence the AIM warning.

[strollingmolby] 08/12/2023 07:54

Thanks mrnumpty. I found the article online in full:

Investing in smaller companies comes with greater risk but offers higher rewards

Questor inheritance tax portfolio: we are sticking with these two small-cap holdings following their mixed recent performances

Smaller companies are inherently riskier than larger ones. They lack the geographical, customer and product diversity, as well as financial strength, of their large-cap peers. This means that their progress can stall following disappointing news that would probably be little more than a “bump in the road” for a larger rival.

The high level of risk that comes with small-cap investing is evidenced in the performance of Questor’s inheritance tax (IHT) portfolio. Since its inception in October 2017, one of our holdings has gone bust and several positions are currently trading at significant capital losses amid a challenging economic environment that is weighing on investor sentiment.

Overall, our Aim-focused portfolio is down around 7pc. While this is vastly better than the FTSE Aim All-Share index’s 30pc slump, the FTSE 100 is flat over the same period.

Of course, smaller companies also offer greater reward potential than their larger peers over the long run. The performance of few, if any, large-cap stocks can rival the 274pc capital return of our holding in Volex since it was added to the portfolio in August 2018, for example.

The manufacturer of cable assemblies that are used in a wide range of applications including consumer electricals and electric vehicles recently released upbeat half-year results. Revenue rose by 11pc, while cost reductions led to an improved profit margin. This meant that operating profits increased by 17pc versus the same period of the prior year.

During the first half of the year, the firm acquired manufacturer of electrical wiring harnesses and automotive battery cables, Murat Ticaret, for $195m. The purchase has the potential to catalyse growth and provides cross-selling opportunities as Volex persists with its five-year plan to deliver annual revenue of $1.2bn by 2027 while maintaining an operating profit margin of 9-10pc.

Achieving that sales figure would represent a two-thirds rise versus 2023’s total annual revenue, which equates to an annualised growth rate of roughly 14pc. As a result, the company’s price-to-earnings ratio of 12.9 suggests it offers good value for money ahead of a new era of accommodative monetary policy that is likely to positively catalyse the world economy’s growth rate.

Volex key facts
- Market value: £561m
- Turnover (Apr 2023): $722.8m
- Pre-tax profits (Apr 2023): $45.8m
- Yield (Apr 2023): 1.3pc
- Most recent year’s dividend: 3.9p
- Net debt (Apr 2023): $103.7m
- Return on capital (Apr 2023): 12pc
- Cash conversion ratio (Apr 2023): 104pc
- p/e ratio (Apr 2023): 12.9

Unsurprisingly, the acquisition meant that the company’s net debt increased during the first half of the financial year. It now stands at $174m, up from $104m six months prior, but still equates to a modest net gearing ratio of around 56pc. Alongside a net interest coverage ratio of five, the company appears to have the financial means to overcome an uncertain near-term outlook.

As a small company, Volex is undoubtedly less protected against economic and industry-related challenges compared with its larger peers. But with a wide margin of safety still present despite its share price surge, it continues to offer investment potential based on its medium-term growth targets and ongoing strong performance. Hold.

[mrnumpty] 08/12/2023 07:45

I no longer hold Volex , but it might be of interest here that it is featured in a fairly large article on page 25 of today’s Telegraph , in the Questor HIT Portfolio as a “ hold “ . Whether or not you concur with that advice , the article might cause some movement in the price today .

[mfhmfh] 03/12/2023 17:20

good read across from CTO re: data centres.

IMHO.

[eeza] 03/12/2023 10:34

Tip update by Midas

[iandippie] 01/12/2023 16:26

Blow your what?

[johndoe23] 01/12/2023 10:24

Pair of 50k prints look like buys to me

[igoe104] 30/11/2023 19:10

Lots are cables will be required for this project.