RIN - Rinker Group

michael_selway said:

RIN RINKER GROUP LIMITED Overnight Price: $13.56
ABN Amro rates the stock as Downgrade to Hold from Buy - Target $15.58 (was $25.00). A revised view on the US housing market has flowed through into cuts to earnings estimates for the company, the broker''s net profit forecasts falling in FY07 by 10.2% to US$797.1m, in FY08 by 19.4% to US$945.9m and in FY09 by 21.8% to US$947.6m.
The changes to forecasts represent a combination of rising costs and falling volumes, the broker now expecting the key states of Florida, Arizona and Nevada to decline faster than the national average in coming years.

As a result the broker has downgraded its rating on the stock.

Target price is $15.58 Current Price is $13.56 Difference:$2.02 - (brackets indicate current price is over target). If RIN meets the ABN Amro target it will return approximately 15% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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RIN RINKER GROUP LIMITED Overnight Price: $14.25
Credit Suisse rates the stock as Upgrade to Outperform - The result was in line with the broker’s expectations, but earnings guidance came in below consensus so the analysts flag possible market downgrades.
Due to potential headwinds, the broker has lowered its target on the stock by 50c to $18.50, but raised its recommendation to Outperform, likely as a result of the recent share price fall.


Target price is $18.50 Current Price is $14.25 Difference:$4.25 - (brackets indicate current price is over target). If RIN meets the Credit Suisse target it will return approximately 30% (excluding dividends, fees and charges - negative figures indicate an expected loss).


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Deutsche Bank rates the stock as Buy - The broker has reduced the price target from $24.04 to $17.93 in response to a drop in US peer multiples from 18.2x to 13.2x. However, the broker remians confident in RIN, noting firstly that it is trading at a significant discount to European peers, and that concrete prices in the US tend to rise during a housing downturn.
The broker notes reaffirmation of guidance at 18-23% growth does not take into account likely CPI price rises in FY07.


Target price is $17.93 Current Price is $14.25 Difference:$3.68 - (brackets indicate current price is over target). If RIN meets the Deutsche Bank target it will return approximately 26% (excluding dividends, fees and charges - negative figures indicate an expected loss).


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JP Morgan rates the stock as Overweight - The broker notes the quarterly result was slightly above its forecast but slightly below market consensus, which the reaffirmed earnings guidance shows were too high.
Following announcement of a 5% share buyback the broker has lifted its EPS estimates in FY07 by 0.8% to US87.8c and in FY08 by 1.8% to US96.7c.

In the broker''s view the current share price factors in the potential downside earnings risk.


Target price is $21.03 Current Price is $14.25 Difference:$6.78 - (brackets indicate current price is over target). If RIN meets the JP Morgan target it will return approximately 48% (excluding dividends, fees and charges - negative figures indicate an expected loss).


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Added
Macquarie rates the stock as Outperform - Broker keeps the faith in the company''s strong fundamentals, but also believes new acquisitions are needed to get rid of the current monkey on Rinker''s back.
Rinker is able to debt finance an acquisition up to US$2bn, Macquarie believes.


Target price is $21.50 Current Price is $14.25 Difference:$7.25 - (brackets indicate current price is over target). If RIN meets the Macquarie target it will return approximately 51% (excluding dividends, fees and charges - negative figures indicate an expected loss).


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Merrill Lynch rates the stock as Buy - The analysts see the result as strong and view the stock as attractively priced at current levels.
However, they have reduced their target on the stock by 6% to $18.00, due to lower earnings and multiple expectations.


Target price is $18.00 Current Price is $14.25 Difference:$3.75 - (brackets indicate current price is over target). If RIN meets the Merrill Lynch target it will return approximately 26% (excluding dividends, fees and charges - negative figures indicate an expected loss).


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SB Citigroup rates the stock as Upgrade to Buy from Hold, Medium Risk - Target $17.35 (was $21.05). The broker notes quarterly profit of US$206m was about 10% below expectations, with margin growth in aggregates also somewhat disappointing in its view.
To factor in a market that appears less bullish than previously expected the broker has trimmed its earnings estimates, with EPS in FY07 down 3.9% to US92.6c, in FY08 down 7.3% to US96.5c and in FY09 down 9.9% to US98.7c.

It suggests at current levels there is now limited downside especially given an upcoming share buyback and a strong balance sheet, so the broker has upgraded its rating.

Valuation is $17.35.


Target price is $17.35 Current Price is $14.25 Difference:$3.10 - (brackets indicate current price is over target). If RIN meets the SB Citigroup target it will return approximately 22% (excluding dividends, fees and charges - negative figures indicate an expected loss).


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UBS rates the stock as Neutral 2 - While the analysts see the quarter as excellent, they are of the view that US housing concerns will continue to dominate and that margin pressures are likely to rise.

Target price is $17.55 Current Price is $14.25 Difference:$3.30 - (brackets indicate current price is over target). If RIN meets the UBS target it will return approximately 23% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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thx

MS

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3 veiws of a secret said:

....... Seems like their's action on this stock ie upward and onward, now that it has reached it's lows. Shall trade RIN closely today.
Adios

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Fab said:

I understand that RIN went XC (not too sure what that means) in the last few days. I understand that might be some kind of special payment back to shareholder. Can anyone let me know if new dividend or special shareholder return are due to happen soon and if yes when should they be credited ?

Cheers

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Fab said:

I understand that RIN went XC (not too sure what that means) in the last few days. I understand that might be some kind of special payment back to shareholder. Can anyone let me know if new dividend or special shareholder return are due to happen soon and if yes when should they be credited ?

Cheers

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Fab said:

Thanks Julia ,

I have currently 700 RIN shares does that mean I can expect $350 to be paid to me on the 25/07 as part of this capital return ?
I also understand they are planning a share buy back soon, can anyone explain me the benefit of a share buy back as my understanding is most of the time this is done at a price below market price ?

Thanks for your help

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19. Rinker's stated purpose in making the return of capital is to achieve the following commercial objectives:

· to move interest cover and gearing ratios towards target levels, substantially reducing Rinker's current under-gearing;

· to minimise its Weighted Average Cost of Capital (WACC) by optimising its capital structure and minimising funding costs;

· to maximise total shareholder returns through the reduction of WACC which will allow for the pursuit of more value creating investment opportunities;

· to demonstrate to the market Rinker's commitment to its capital management strategy;

· to remove any adverse impact on the share price which may arise from the market perception that a high interest cover and low gearing reflects inefficient capital management and could lead to sub-optimal investment decisions; and

· to take advantage of significant committed debt facilities.

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Fab said:

Scsl,

Thanks very much for your feedback this is exactly what I was after. Even though RIN has been going down heavily recently I am very pleased at all the money they have been paying out in the last couple of months. Including the payment due on the 17/08/06 I will have received $830 for 700 shares . Not bad at all for shares that were purchased 10 years ago at $4.50

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noirua said:

RIN continue down and may test the $13 level shortly - the Board of Directors must be a little worried, and the rapid decline, in share price, appears to have caught them on the hop.

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noirua said:

Rinker ...... providing Uncle Sam continues to head North, we will not have the dead cat bounce theory thrown in our faces.

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3 veiws of a secret said:

I do agree with you (Noirua)......I just felt peeved I read the lows incorrectly and entered a few days too early ,but at least I'm on the magic bus,RIN & GTP,have been speculative buys for me ,but more so with GTP.Both cheap as chips ,just wish I had more bars of gold to auction.
Geeeeee RIN $13.09 yesterday,tell me its either a bargain or a give away!

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Realist said:

RIN is now fairly valued based on the last 4 years earnings.

And with growth of about 16% p.a. up to now it would be cheap if you did not look foward.

The chart may be a little misleading as it has recently paid a 64 cent dividend, so you astrologers may be reading it a bit incorrectly.

They look after investors with an excellent dividend policy of paying back 35% to shareholders, and they're implementing a buy-back which looks legit and fair and in the shareholders interest.

I'd say they are a good longterm buy now at under $13. Infact I may get me some today at $12.95. Although I will wait and hope for further drops!

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michael_selway said:

You have to look at the derivative, ie 16% pa is current velocity only

but if you look at the forecasts, its slowing down

Earnings and Dividends Forecast (cents per share)
2006 2007 2008 2009
EPS 106.7 123.4 132.4 138.6
DPS 78.0 45.0 46.5 50.4

138.6/132.4 = 1.0468 = 4.7% growth

thx

MS

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