I haven't bothered looking at any of these mining services stocks lately, but my guess is that analysts are finally starting to smell the roses and are currently revising some of the ridiculous earnings estimates that they had for 2013 and 2014 for stocks in this sector.Still dropping like a stone. To my un trained eye either something is up or its way over sold. I wonder what the bottom will be?
Still dropping like a stone. To my un trained eye either something is up or its way over sold. I wonder what the bottom will be?
Continue to be a believer and have bitten away at the falling knife over the past six months - resulting in a rather large position that is starting to shake the belief.
A company with a solid track record - 30% ROE, $110M in net cash, 4% dividend and steady EPS growth is being offered at a PE of 5. I am finding it hard to turn it down.
I guess I will be either a big winner or not but I continue to struggle to see how this can be valued anything south of $6. Time will tell.
A company with a solid track record - 30% ROE, $110M in net cash, 4% dividend and steady EPS growth is being offered at a PE of 5. I am finding it hard to turn it down.
8,832/424,673 <> 12%. Net profit margin has contracted from 12% to 9%. If labour costs are rising, then why hasn't the company made some reference to that and outlined ways it is mitigating that effect (like being able to pass the cost on), or at the very least acknowledged it is occurring.
Is this expected to continue? I mean if you are sitting here this time next year and NPM has contracted a further 3 points, their going to need some serious headline growth to lift the bottom line.
The Board of Forge Group Limited (ASX: FGE) (Company) wishes to advise that the
Company anticipates net profit before tax (NPBT) for the financial year ending 30th June
2013 to be in the range of $90M to $100M. This represents an improvement on the previous corresponding period (pcp $70M) of between 28% and 43%. Revenue is expected to be in the range of $950M to $1.0B for the financial year ending 30 th June 2013. This represents an increase on the previous corresponding period (pcp $781M) of between 22% and 28%. The Board anticipates the weighting of both NPBT and Revenue to be approximately evenly
split between the first and second half of the 2013 financial year.
Wait for ASX speeding ticket. On cofirmation of no real issues there's probably a short term long trade to be had.
Buying now risks a profit downgrade like many others in the sector.
Good update. Very surprising actually. They're still getting work albeit they are doing it on margins under 10% instead of the old 20%+.
I don wonder how sustainable this is. These guys aren't selling burgers. My doubts remain.
Good update. Very surprising actually. They're still getting work albeit they are doing it on margins under 10% instead of the old 20%+.
I don wonder how sustainable this is. These guys aren't selling burgers. My doubts remain.
If you compare FGE to many of the other mining services companies they are in a very strong position. A downturn in the short term could be good for FGE as marginal players are forced out or become uncompetitive leaving more work for FGE.
On reflection, the market reacted to the FGE announcement in a very subdued way (or as subdued as a 17% daily spike can be).
Prior to the announcement, consensus EPS for 2013 was $0.65 which can now reasonably be increased to $0.77.
Prior to the announcement, SP was $3.29 and it ended the day at $3.85.
Basically the market seems to be only prepared to pay 5 times earnings at the moment for this company. Will be interesting to see if it is re-rated over the next few months - an undemanding PE of 8 would raise it back to where I see it as being fairly priced.
Battled its way through $4 today - interesting to see if it can continue its upwards movement.
Most mining service stocks put in a good performance today. I think we probably have a mid term bottom for the sector - until the next reporting season in Feb is my guess - as long as the overall market doesn't fall substantially (which looks unlikely).
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