Sold out Out at 276+ 25% gain in 6 months + dividend. The ongoing growth looks anaemic and Iâ€™m unsure where the companies big advantage lies. Games
Overvalued? This is a link to simply wallâ€™s assessment of intrinsic vale [link] They seem to think it was overvalued at 231 compared to 167 for their measure of intrinisc value. On that basis (should y0u believe it of course), itâ€™s even more overvalued at 275 to 280 where it is now. Games
Blunderberg "QinetiQ: Berenberg downgrades to hold with a target price of 276p."well given the stock is sitting at 268.3, they should revise it to a buy otherwise they are asking you to leave money on the table.Or maybe they are just not very bright people.Games
Results [link] solid enough :-Revenue up £833M versus £783M in 2017Profit after tax £138.1m versus £123.3m 2017Earnings per share 24.4p v 21.5pFull year dividend per share 6.3p v 6.0p up 5%Net cash £266.8m v £221.9morder backlog has fallen though from £2,178.7m to £2,005.4mThe stock jumped initially over 5% only to fall back again fairly sharply.Games
Games,Appreciate what you say, but when an acquirer buys on a cash-free, debt-free basis as per the RNS, you dont need to worry about what the previous owners Capital Structure was like as it is an irrelevance. Thats the whole purpose of EBITDA, to provide a benchmark ignoring Interest, Tax and Depreciation/Amortisation. Essentially, those measures are history from a forward perspective.
Re: Spending the cash "You definitely don't take Interest and Tax into account when buying a business."Jack - I do as I'd only be interested in the real profit multiple -- not saying this is a bad deal at all, just that it's pricey and the historical trade figures my not reflect what happens when it becomes part of QQ.In my experience most acquisitions offer a poorer return after the deal is done so if you applied some risk element to the operational merging of the units, it could look even more expensive.Ignoring the previous tax element is all well and good, but unless you are a registered charity, you will also be subject to some similar corporate rate tax charge.Whether you pay in cash or finance the deal in another form like cash or equity also doesn't really matter as it's the opportunity cost comparison that you will be taking into account.They are paying a high multiple for a service orientated business entity.Games
Re: Spending the cash Games.....Look at the financial highlights, as it's a good deal. You definitely don't take Interest and Tax into account when buying a business. Purchasers ignore these as they don't care about the previous tax rate/regime, as that will change on new ownership. Likewise, how the business is funded Pre acquisition is of no interest. QQ are paying cash, so whatever debt structure previously existed can be discounted. EBITDA is a measure for a reason..........JackCompound annual revenue growth of 17% over the past three financial yearsAverage EBITDA margin of more than 20% over the past three financial yearsStrong cash flow generationExpected to enhance QinetiQ's earnings per share in the current financial yearReturns exceed QinetiQ's cost of capitalFunded from QinetiQ's available cash resource
Re: Spending the cash Hear what your saying games, but management feels it will integrate well and is a potential high growth business. Good cash generation as well. Market seems to be backing the management on this move. (sp 236p)
Re: Spending the cash seems a bit expensive at euro70M compared to an EBITDA of euro5.4Malmost 13X EBITDAAs a multiple of the real profit (i.e. what they make after paying interest charges, tax, depreciation and amortisation) is probably closer to 20XGames
Spending the cash [link] training expansion Games
In the black.... So far so good, it must be the general +ve sentiment towards military companies in the face of hostilities.Could it have a long run up from here perhaps?Games
Pre close statement [link] much new . 24th May for results.Games
3rd post this year........ ........and the year end is upon us. Not much interest here and a lacklustre SP to match.It will be good to see if the EPS has held at 11.3p ?Do annual Revenues breach £850M with PAT of £140M ? Whats happening to the Net cash balance ? What Investments have been made or will there be a return of cash to Shareholders ?Whats the funded Order Backlog for FY 18/19 ?How are we going to break out of stagnate momentum ? Where is the excitement ?
Dragonfire I bought today at 214p to slot into my ISA. Looks like a well run innovative business with its specialities. The Dragonfire laser technology could be a real growth driver from say 2020 which could have a wide range of uses/spin offs. Seems to be the only U.K. company developing lasers for defence. Given the sp weakness seen it is always difficult to know when is best time to buy short term but, this could well be one to tuck in the bottom draw for a few years.
Higher US Defence Spending [link] it didn't carry the sentiment over to QQ this morning!Games