This little beauty is going great guns.
I No longer think it is only worth 2.35
It is perfectly placed to expand and pick up flood damage repair construction contracts. Once in a lifetime opp for them.
Blue sky ahead
I agree - this does look like a good stock! I think it is currently under valued with a high ROE, low debt, many projects in the pipeline.
Hmm, could be a buy after the share price has taken a beating.
Wow, isn't this another of Roger's A1 businesses? I know back in May he was talking about how it's in his fund.
Wow, isn't this another of Roger's A1 businesses? I know back in May he was talking about how it's in his fund.
I remember checking this out when Roger the Dodger was spurting about them last year. He said it was a dividend stock for the future or something to that extent. I remember passing at the time because I don't particularly adore cyclical construction / infrastructure / contracting services stocks. Margins in all services based companies are contracting big time due to heavily rising costs. It's all over the media. I thought RM was crazy calling it a "long-term" hold for these reasons.
Don't these guys build roads? (Especially up in QLD) I believe the government up here is keen on delaying any sort of sizeable infrastructure spending because the debt burden up here is apparently unmanageable (especially if they want to regain their AAA credit rating).
Who else is likely to spend major money on roads if the governments delay projects? Sounds like a no brainer to avoid this stock due to the obvious earnings risks.
I also note that their current order book is lower than what it was before they listed! Combine this with rising costs and you can probably see where this is going in the short to medium term.
edit: for a company with forseeable earnings risk it actually looks fairly expensive still as market cap is still double net assets (more if you make some reasonable adjustments).
Got that here we go again feeling. Picked up some today at $1.18 for my personal account then a bit more for $1.035 for the super. I think there has been a over reaction and expect to see some decent returns in the future. This is not MCE, these guys have next to no debt and a good pipeline of contracts in place.
Got that here we go again feeling. Picked up some today at $1.18 for my personal account then a bit more for $1.035 for the super. I think there has been a over reaction and expect to see some decent returns in the future. This is not MCE, these guys have next to no debt and a good pipeline of contracts in place.
LEI had a pretty good pipeline of contracts (still does) until they realised that they weren't actually making money on them...
Parts of SWL's announcement certainly point to that.
On the positive side, SWL has a pretty clean balance sheet (~$35m cash and ~$9m debt), so they should be in a position to weather some downturn. The size of projects they run are in the $50-100m space - so it will take a couple of true shockers for them to be in trouble. Many many years ago I worked in the industry and SWL was already around, doing much of the same things. And frankly most of their projects are run-of-the-mill roads, bridges and earthworks so the technical risks are reasonably managable... I don't know what part of the Gold Coast light rail (which has been on paper for at least 15 years) they are doing but I am guessing only the civil instrastructure.
Commercial risks are a different story and the share price surely reflects that uncertainty.
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