gretel
28 Nov 2017
New research note out from Edison. They go for a 177p-187p valuation range, with 12.9p EPS this year rising to 15.2p EPS next year:[link] CTP recovery to drive share price upside We use a P/E-based, sum-of-the-parts methodology with three sets of sample peers drawn from the medical device manufacturing (P/E of 16.4x), automotive (mean P/E of 15.6x) and aerospace (mean P/E 19.0x) sectors to reflect the diversity of Carclo’s operations. This gives an indicative valuation range of 177-187p a share (previously 182-193p). Further newsflow confirming the recovery in CTP should be supportive of the stock, helping to close the valuation gap."In particular:"In the longer term, divisional growth is driven by capacity expansion, which is always linked to customer contracts, while creating space to secure new customers and product lines in future. For example, the project to double the capacity of the facility in Bangalore to meet expected demand from its major electronics customer for technical parts and assemblies is now complete. The second phase of expansion at Mitcham in the UK, which is required to support the manufacture of part of Becton Dickinson’s Vystra disposable pen, remains on schedule for completion later in FY18, ahead of volume production in calendar 2018. The facility in Taicang, China, which was completed during H216, continues to provide production capacity for the anchor global medical device customer as well as accommodating new work from existing and new customers."
II Editor
27 Nov 2017
NEW ARTICLE: Trends and Targets for 27/11/2017 " FTSE this Week (FTSE:UKX) We've had pretty good reason to expect some good "stuff" from the markets, absolutely none of which has made itself known on the FTSE. The US, Germany, even France, responded to the upward forces, the FTSE opted ..."[link]
Lupo di mare
25 Nov 2017
Re: Latest forecasts: forward P/E of 8.8 Those P/E forecasts might, or might not, be correct, but they have to be seen in context with large debt and PF deficit. Remove those, and the P/E would be higher.The investment required in the LED business, in particular, concerns me with regard to debt, but we shall see. I still believe that LED should be flogged-off, leaving a debt-free TP.Lupo, who sold his remaining shares some time ago at 140p.
gretel
21 Nov 2017
Latest forecasts: forward P/E of 8.8 For the record, consensus forecasts are now 12.66p EPS for this year from 5 analysts, with 15.22p forecast for next year. That's a current year P/E at 134.5p of 10.6, falling to just 8.8 next year.Looking further ahead, the latest Equity Development forecasts are 17.7p EPS to March'20, rising to 20p EPS and then 22.2p EPS are also now shown.
paul1945
17 Nov 2017
SFR Gretel I made a loss yrs ago I have just + ISAT @ 488.8
gretel
17 Nov 2017
CAR to benefit from US tax cuts Overnight the US House of Representatives passed tax reforms which would slash corporate tax rates to 20% (from 35%) - now the Senate must do the same.CAR would benefit very nicely from such a reduction in tax:[link] : Paul, the other company was SFR, which I held very profitably for a while but am unsure about at present for a number of reasons.
paul1945
15 Nov 2017
Re: Tipped tonight on Motley Fool V.G. thanks. what was the other 1 !
gretel
14 Nov 2017
Tipped tonight on Motley Fool [link] growth stocks I’d buy and hold until 2020 or beyondG A Chester | Tuesday, 14th November, 2017 Shares of Carclo (LSE: CAR) are trading 3% higher today at 145p after the global manufacturing group reported “solid first-half trading overall” and said: “The Board anticipates full-year trading will be in line with its expectations and the Group remains on track to grow substantially over the medium term.”Today’s results give me confidence that this FTSE SmallCap firm, which has a market cap of £106m, is a growth stock I’d be happy to buy and hold until 2020 or beyond. And I feel the same about a £205m-cap stock from the same index, which I’ll come on to shortly.Down to businessCarclo’s largest division, Technical Plastics (about 60% of group revenues), supplies fine-tolerance, injection-moulded plastic components, mainly for medical products. The division’s first-half operating profit fell 6%. Management said this was due to some key new programmes being delayed into the second half and some operational issues that have now been largely resolved.The lower profit from Technical Plastics was offset by a 16% increase at its other principal division, LED Technologies. This business, which designs and supplies specialised injection-moulded lighting systems to the luxury and supercar industry, accounts for 35% of group revenue.The company’s balance sheet remains reasonable after an anticipated rise in net debt to £29.6m from £26m. And there was an encouraging fall in the pension deficit from a previously elevated level.Nice growth stock on cheap valuationAll three of Carclo’s divisions (the third is a small business in aerospace) are set to have a stronger second half. Forecast earnings per share (EPS) of 12.75p for the full-year to 31 March put the company on a price-to-earnings (P/E) ratio of 11.4. This falls to just 9.5 for fiscal 2019 on the back of a forecast EPS increase to 15.3p, as that substantial medium-term profit growth the company referred to kicks in.The company has been investing in its manufacturing assets, increasing capacity and efficiency, which should contribute to top-line growth (higher volumes) and bottom-line growth (higher profit margins). Operating in attractive markets and well diversified geographically, with 70% of revenues coming from outside the UK, I see Carclo as a nice growth stock on a cheap valuation."
r21442
14 Nov 2017
Re: I.C BUY The full text...Tip Update: Buy at 145pTip styleGROWTHRisk ratingMEDIUMTimescaleMEDIUM TERMOur previous tipWe said BUY at 137p on 30 Apr 2015Tip performance to date+6%Mark RobinsonHalf-year figures reaffirm that the resolution of operational issues at Carclo’s (CAR) technical plastics division is under way. Although underlying profit fell on the 2016 comparative, and revenue flatlined once currency and acquisition effects are factored in, the division’s operating margins are now expected to “improve significantly”. Following the successful expansion of a production facility in India, and expectations of a higher proportion of design and tooling profits recognised in the second half, that optimism appears well grounded.A 16 per cent rise in underlying profitability in the LED technologies business partially offset the difficulties within technical plastics and the group’s smaller aerospace arm, but underlying earnings were still constrained. The LED division is also set fair for the remainder of 2018 as several pre-development programmes are expected to translate into project awards over the second half. “Design, development and sub-contract tooling revenues” were ahead of management expectations, while the ability to meet the build up in orders has been met by increased warehousing capacity in Buckingham.Peel Hunt forecasts adjusted pre-tax profit of £12.7m for the March 2018 year-end, leading to EPS of 13p, against £11m and 12.1p in 2017.These developments were largely foreshadowed in September’s trading update, so shareholders will now concentrate on the extent to which the design and tooling profits will be second-half weighted. Net debt is up, a reflection of recent capital commitments, but it remains well within banking covenants. At 145p, the shares are slightly up on our original call (137p, 30 Apr 2015) but trade below the peer average at an undemanding 11 times forecast earnings. Buy.
gretel
14 Nov 2017
Peel Hunt and N+1 Singer say Buy Peel Hunt reiterate their Buy and 200p target, whilst Singer also say Buy with a 175p target:[link]
paul1945
14 Nov 2017
I.C BUY I.C. BUY rating today also buy ITV VOD AV. BTG
gretel
14 Nov 2017
Equity Development raise target to 206p New report from Equity Development - they increase their SOTP valuation to 206p (from 200p).The caveat here is that the Wipac contracts are awarded as promised in H2. Assuming no material slip-ups, then CAR still looks cheap as chips to me given the potential and global leadership position in two high-growth sectors:[link] valuation moves up to 206p/shareFactoring all this in, our sum-of-the-parts valuation rises to 206p/share (from 200p) – derived from using FY21 EV/EBIT multiples of 14x for Technical Plastics (64% FY17 sales), 12.2x LED Tech (31%) and 10x Aerospace (5%), discounted back at 12%, and adjusted for central overheads and the above balance sheet movements""Stock appears undervalued vs most metricsLikewise in relative terms, we believe the stock rates as good value, trading on EV/EBIT and PER and multiples of 9.3x and 10.9x respectively vs peer averages of >16x and >20x (as below).""Lastly, don’t forget that the vast majority of Carclo’s turnover is tied to long-cycle deliveries on OEM platforms with typical life-spans of between 5-20 years. Hence providing good overall visibility and earnings quality."
gretel
14 Nov 2017
Trading expected to be in line Interims are as expected and already flagged, and the good news is that the outlook remains rosy. This H2 is expected to be every good in each of the three divisions.CAR specifically state that they expect to trade in line with forecasts of around 13p EPS for the year:[link] Board anticipates that the Group will trade in line with its expectations for the full year, with all three divisions set to have a stronger second half performance, and the Group remains on track to grow substantially over the medium term."
Lupo di mare
08 Nov 2017
Re: Tipped: "Dirt cheap" growth stock "Because of this (referendum), its net pension liabilities rose from £18.9m to £27m year-on-year in 2017, which wiped out the firm’s excess cash position, increased leverage and led it to cancel its dividend for the year."What absolute tosh, they mes sed up and found it convenient to blame Brexit. See below what they had to say about increased pension deficit (£9.3m increase) up to 3/2016."As at 31 March 2016 the group pension scheme had a deficit of £19.0 million net of deferred tax (2015 - £9.7 million) as calculated under IAS 19. The defined benefit pension liability decreased slightly to £196.9 million (2015 - £201.1 million) whilst the fair value of the scheme assets decreased to £173.7 million (2015 - £189.0 million) reflecting the poor performance of equity markets during the year. The revised investment strategy of the scheme pension trustees to invest in diversified growth funds assisted the performance of the scheme assets relative to the broader performance of equities."Fool indeed.
gretel
08 Nov 2017
Tipped: "Dirt cheap" growth stock "Dirt cheap" growth stock:[link] dirt-cheap growth stocks to consider in NovemberIan Pierce | Tuesday, 7th November, 2017 After growing earnings by double-digits in each of the last four years, shares of specialist manufacturer Carclo (LSE: CAR) trade at only 10.8 times forward earnings, which has put the firm on my watch list.The company is fairly diversified with three main divisions: technical moulds for the medical devices industry that brought in £88m in the year to March, making exterior lights for supercars that accounted for £43m in sales, and an aircraft components division that grossed £7m.Each of these end markets has performed very well in recent years and increased volumes have improved operational gearing, leading to the firm’s operating margins increasing annually from 5.39% in 2013 to 8.3% in fiscal 2017.However, it’s not all roses and butterflies for Carclo as the UK’s decision to exit the EU has thrown up significant roadblocks for the firm. Brexit wreaked havoc on the bond markets and led to a sharp fall in the bond yields it used to discount its pension obligations. Because of this, its net pension liabilities rose from £18.9m to £27m year-on-year in 2017, which wiped out the firm’s excess cash position, increased leverage and led it to cancel its dividend for the year.But even with that in mind, Carclo was never a huge income stock and analysts have pencilled in earnings increases of 5% and 20% for the next two years respectively as global GDP growth remains high, stoking demand for each of its end markets. Economic tailwinds and a history of making smart bolt-on acquisitions makes hitting these forecasts entirely reasonable. And with a very attractive valuation, I’ll be digging into Carclo some more in November."
