MAH - Macmahon Holdings

[Speewha]

Re: MAH - Up or Down

Hello,

Not much comment here on MAH since March so assume not very many interested at ASF.

Need some assistance in reading recent chart seems to get support up to $1.70 then falls back slightly. If you look at course of sales last week or so lots of very small trades some smartie buys 25 then sells 25 about 30 mins later.
Hope one of you chartist can have look and give your opinion , is it going to break the $1.70 or fall away.

Regards

 

[LRG]

I think you may see the SP start to head north soon.

They are now locking in projects that were in preliminary design phase such as Hale Street Bridge in Brisbane; QRail central QLd coal upgrade project - both these in 100's of millions that will be built over next 18 - 24 months.

Plus they have locked in some more mining contracts.

I am not sure what the latest is on the Ausdrill takeover bid though??

Anyone heard?

While there is this 5-7 year infrastructure boom on in Aus you will see them get more and more turnover with less profit risk as the years go by - just like LEI etc.

There reports predict 30-40% growth year on year. I hold some of these long term and will review in 5-7 years if the infrastructure boom shows signs of platuea. They are not a good yield stock, but IMO are an excellent capital gain stock.

LEI not long ago were $10 went to $60+ and are now $40+.

I see MAH as a mini LEI ready to replicate the growth in SP in the coming 5+ years. Hope I am right, then I will sell down into a higher yield stock.

 

[LRG]

OMG what is going on here!!!

This share has tanked the last few weeks from 1.85 to .75 - why??

It's revenue / profit is growing at 20-30% per annum.

i don't get it!

I don't like losing 60% in a few weeks!

Does anyone else hold this??

 

[Miner]

OMG what is going on here!!!

This share has tanked the last few weeks from 1.85 to .75 - why??

It's revenue / profit is growing at 20-30% per annum.

i don't get it!

I don't like losing 60% in a few weeks!

Does anyone else hold this??

MAH had a good business plan and at one time almost getting snared by LEI

Still chances are there

I guess that even if they have contracts in hand, their clients are not going to spend money in excavation. So operating contracts become paper tiger and so no fund being accumulated.

That is why MAH probably getting punished. See FMG tanking. So if your company is a mining contractor with FMG it is obvious that your share price will tank too

 

[Kipp]

That is why MAH probably getting punished. See FMG tanking. So if your company is a mining contractor with FMG it is obvious that your share price will tank too

Slapped again hard on Friday... closed at 70c. Still has plenty of work on the order book (over $2 Bill)... which includes work OUTSIDE the mining sector (Gov't contracts, QLD rail). BHP is a major client of MacMahon, and I don't see them going under just yet- though they have delayed Olympic Dam for a few years I read on another thread.


Looking cheap to me- but so is everything in this market?!

 

[Kipp]

See FMG tanking. So if your company is a mining contractor with FMG it is obvious that your share price will tank too

Em... are you sure they are involved with FMG? I see Rio, BHP and the govt as their key clients, and no projects with Fortesque.

EPS of 9.2c in 2008... should be well over 10c in FY09 according to their forecasts.
But imagine they will suffer a bit from Olympic Dam delays (worth 100mill).

 

[kengaikl]

Whats going on with MAH's share price. A 10% cut in forcast earnings equates to a 70% fall in the share price???? and they do not have cantracts with FMG. 75% are with BHP RIO and the Govvernment.

 

[Miner]

Em... are you sure they are involved with FMG? I see Rio, BHP and the govt as their key clients, and no projects with Fortesque.

EPS of 9.2c in 2008... should be well over 10c in FY09 according to their forecasts.
But imagine they will suffer a bit from Olympic Dam delays (worth 100mill).

I thought MAH got a contract from BHP for rail and Mitsubishi Coal as well
They basically stuffed up by chasing AUSdrill. Now Aus Drill also lost lot of money by buying back its shares (the MD did) and with FMG slow demise they are going to loose potential revenue from its $300 M contract.

I do not know any inside story excepting it is suffering from some of the mine closure and no contract execution. But I believe it has a good business plan

But no prediction as all predictions go into drain with recession in every wheere

 

[muzzza]

Mcmahon Holdings announced today that it had been awarded a $40 million contract to construct the new Bunbury Port Access Road in Western Australia.

Up 10% today for a $0.42 close.

Whats the opinion out there - may be a good long term company to add to the portfolio?

 

[bloomy88]

Been quite on this thread for a while. After MAH's dive from $1.90ish to 30c it looks to have consolidated at the 30c mark.
Although their industry is highly volatile at the moment and profit margins will be thin does any one have an opinion on MAH as a long term buy?

Huntley's Recomendation on Etrade recently down to a hold from a buy:

While 1H09 revenue growth continued to be strong growing 20% to $734.8m, as indicated in December 1H09 profit fell significantly below the pcp due to the timing of revenue recognition on two challenging construction contracts due for completion during H2. The financial outcome of both of these contracts is subject to the finalisation of claims with clients. As a result Construction pretax profit fell 70% to $6.4m despite revenue increasing 17% to $377m. The company now downgrades full-year NPAT guidance from ‘in line with last year’ - $48.8m – to $40m, plus or minus 10%. Directors cut the dividend from 2c to 1.5c fully franked. While the share price may continue to hold up at current levels given already large falls, the short to medium term could deliver nasty surprises that further sharply reduce profit. Thin margins make contractors’ profit highly volatile. With a bit of luck the civil construction sector will offset weakness in mining, but we still find it difficult to construct a convincing investment case in the current environment.

Cheers
Bloomy

 

[LRG]

MAH has been climbing well the last week out of the 30's now just over 50 cents.

Stock put on hold on friday awaiting announcement of a major project!

Looks like some good news early next week and the recovery will continue?

It will take many years though to get back to $2 IMO.

 

[Lachlan6]

I have not looked at MAH for a while but this stock used to be one of my favourites. It looks sensational at the moment. It broke out of a large consolidation phase on Friday, volume is up and it really appears to be wanting to get on with it now. I will certainly be looking to place an order on Monday.

 

[bloomy88]

Big announcement from MAH today, projected NPAT is now expected to be in the range of 15 - 20 million. This is a significant downgrade from the $40 million guidance they last announced.
This announcement has prompted a 40% crash in MAHs SP today though.
I beleive MAH is still a great company for the future and it's alliance with Leighton is a great plus.

Is anyone looking to buy in at these prices? Before this announcement Huntley's had a buy trigger on MAH for between 25-35c but im sure that will change as a result of this announcement.

All thought are appreciated
Bloomy

 

[johannlo]

Me, but I'm in this one for the short term, once the panic stops and the price recovers ~20% I'm out again.

I like Ausenco (AAX) more if you're after a long term engineering buy.

 

[Sean K]

Is this an overreaction?

Good knife grab opportunity?

Seems overdone initially, this had already been factored in to the sp in my opinion. Therefore, my guess is that it will have been oversold on fear.

Does LEI hold a large stake in this?

Just a guess that there will be some consolidation in this sector with the big players mopping up the trash. This is looking like trash now.

 

[bloomy88]

I think it is a great oportunity to buy MAH at this price. Looks like an over-reaction to me as well.

Leighton have a 17% stake in MAH and often use them in their projects,
ie: BHP rail contract which will bring $250million in revenue to MAH...

 

[johannlo]

Exactly my logic. I believe price will recover at least 10-20% within the next 6 months.

I'm a bit of a n00b and have a very moderate, spread-the-risk strategy so YMMV but this is definitely a speculative buy for me.

We also have the double whammy of the engineering stock general downturn on the back to today's business age/SMH article about WA/QLD engineering downturn forecasts, I think this has combined to cause today's panic selling.

 

[bloomy88]

Huntley has reduced their Accumulation and Buy triggers to $0.35 and $0.26 respectively following MAHs profit downgrade yesterday.
MAH up 4% so far today but i beleive their could be some volatile trading in the days ahead for them. Im sure the increase in gearing from 12% to just under 40% would be worrying people as well, couldnt be a good sign for their current cash flow.
I think ill wait a bit before i jump in now, there could be some more bad news on the way for MAH. I still beleive that it is a solid company though and it will be recovering strongly when the economy heats up again.
Cheers

 

[Annwn]

Stronger Vol on the last 2 days in response to announcements, broken a long term trading range.

31 July 2009
Ulan Line Alliance Win
Macmahon Holdings Limited (ASX:MAH) and Australian Rail Track Corporation (ARTC) announced today that ARTC has awarded Macmahon and MVM Rail work as part of the $100 million Ulan Line Alliance programme.
The package is one of three capital works programmes designed to increase the coal carrying capacity of the Main Northern Railway Corridor in the Hunter Valley region of New South Wales.
The Ulan Line Alliance will undertake the design and construction of eleven passing loops and associated tunnel ventilation works on the line between Muswellbrook and Ulan.
Macmahon Chief Executive Officer, Nick Bowen, said that the announcement reflected the Group’s growing ability to provide comprehensive civil infrastructure solutions to major customers, such as the ARTC.

27 July 2009
Macmahon awarded Olympic Dam contract extension
Macmahon Holdings Limited (ASX:MAH) announced today that it had been awarded a two year contract extension at BHP Billiton’s Olympic Dam copper and uranium mine in South Australia.
The contract involves underground mine development works, including shotcreting, cable bolting and other associated works, with an estimated value of more than $110 million.
Macmahon Chief Executive Officer, Nick Bowen, said Macmahon has been operating at Olympic Dam since 2004 and has consistently delivered safe, productive and quality services.
“Our contract at Olympic Dam has now been extended four times, and on each occasion, our team of experienced people have stepped up and responded to the client’s requirements.

 

[gfresh]

Interesting Ann after close on Friday..

MOU with Leighton is to be renewed in November.. Leighton is pushing Macmahon to remove the clause that says they must require written permission to increase their stake over 19.9% of MAH..

So looks like LEI is keen on holding the option of acquiring a controlling stake in Macmahon at some point.

Presently trading at 57.5c