Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on VESUVIUS PLC. We currently have 16 research reports from 1 professional analysts.
|09Feb17 12:04||RNS||Holding(s) in Company|
|07Feb17 14:37||RNS||Holding(s) in Company|
|30Jan17 16:00||RNS||Appointment of joint corporate broker|
|30Jan17 14:12||RNS||Total Voting Rights|
|19Jan17 17:55||RNS||Holding(s) in Company|
|05Jan17 09:42||RNS||Holding(s) in Company|
|22Dec16 15:45||RNS||Acquisition of Brazilian Mold Flux business|
Frequency of research reports
Research reports on
Panmure Morning Note 08-09-2016
08 Sep 16
QE is like Heineken, except it destroys things other stupid policies cannot reach. In the steel industry, it has the remarkable ability to encourage more capacity building while destroying demand. Since our downgrade to SELL on July 22, the fundamentals have deteriorated further with global steel capacity utilisation falling back to Q3/15 levels. China, struggling to find domestic home for its steel, is ramping up exports and destroying margins anywhere where it can. However, demand is struggling to pick up. US domestic steel output and prices have cracked despite imposition of heavy import duties. We believe we are heading for another almighty crash, and it is hard to see how Vesuvius can sustain H1/16 performance in H2/16. We expect FY EPS to come 7% below consensus.
Steel markets heading for another almighty crash
22 Jul 16
At the start of the year, we were wrong to assume that China would take action to curtail its excess capacity and help stabilise steel markets. Latest data suggests otherwise. As Chinese surplus and global imbalances build up, trade barriers in markets like the US and India will soon be overwhelmed. As production rates come under pressure outside China, it is hard to see how Vesuvius can sustain H1/16 performance in H2/16. Consequently, we are moving our recommendation from BUY to SELL, with a target price of 300p (from 380p).
Panmure Morning Note 13-06-2016
13 Jun 16
The economics of the US steel industry continue to improve, albeit not because of demand. Tariffs are helping to cut Chinese imports in the US markets, where steel prices are now up 70% since the low point in December 2015. More importantly, capacity utilisation at US steel mills has improved from 60% in December 2016 to 75% in early June. Year-to-date US steel output is still around 2% below the same period last year, better outcome than expected given the excess Chinese production. Bears will argue that fundamentally the industry is still weak given the global over-supply. We continue to believe that at some stage China will have to take action as its steel is increasingly unwelcome around the world.
Panmure Morning Note 09-05-2016
09 May 16
Vesuvius will issue a trading update on Thursday and we expect the management to remain cautious about trading, particularly given that China appears to be reversing its policy of cutting capacity. However, we continue to believe that the fundamentals of the steel industry are improving and therefore we maintain our BUY recommendation. We believe as its exports are made increasingly unwelcome across the world, China will have no option but to cut capacity as domestic stocks rise and losses mount. US steel prices are up more than 50% and this matters more to Vesuvius as US mills increase production and restocks on consumables. The management is not relying on a turnaround to deliver cash returns. However, as fundamentals improve the risk to our forecasts are on the upside. In the meantime, an attractive yield of 5%, which we believe is sustainable, underpins the share price.
Panmure Morning Note 23-03-2016
23 Mar 16
Improvement in steel markets look real; production is being cut. In the first two months of 2016, global steel output fell by over 5% year-on-year. China, which still produces 50% of world steel, is leading the way with 6% cut in output. In the US, after heavy falls in January, output grew 3% in February and has continued to grow at this pace in March so far. For Vesuvius, the mix of cuts is beneficial as it sells more and makes higher margins in the US than in China. We now believe US sales will fall by 5% this year versus our previous expectation of a 10% fall. At the same time, we expect Asia-Pacific sales to fall 5% and not 1%. However, the margin mix will improve, and as a result we are upgrading our 2016 forecast by 6% to 23.9p, and our target price to 380p (from 370p).
Greed and Fear
03 Mar 16
Today’s results confirmed that nothing has materially changed – Vesuvius remains a cyclical business operating in a very mature industry and the best the management can do is to focus on return on capital rather than capital growth. Five years of “growth” and “restructuring” have been undone in one year: 2015 sales and trading profits were below 2010. While the valuation in the long-term will continue to be driven by the dividend, the cyclicality of the steel industry will inevitably create swings of greed and fear. We seem to have entered a period of greed, with the latest US anti-dumping decision currently providing most of the excitement. If the current discipline of production cuts is maintained, then the news flow on steel prices and expectations of rebound in 2017 steel output will add momentum to the share price. We are raising our target price to 370p (330p), equivalent to 4.4% yield. This compares with the average UK market yield of 3.4%.
Emerging from the clouds
16 Feb 17
Rolls-Royce’s underlying performance in FY16 was ahead of both its own and market expectations. Media focus on the non-cash £4.4bn headline FX loss is missing what looks to be the basis for optimism. As the civil model starts to move from investment in engines for the A350 and A330neo into the aftermarket delivery phase over the remainder of the decade, we think cash flow is likely to improve, particularly if supported by an eventual recovery in Marine.
15 Feb 17
At the current market capitalisation of £29m, we believe the shares are significantly undervalued. We estimate that the highly profitable Maritime business is alone worth at least £40m. With net cash of £9m at end-2016, this implies that the market is currently ascribing a combined negative value of £17m to the rest of the group, which together account for c.54% of group revenues. This is very harsh given the management actions to transform TP Group to a profit-driven Tier 2 specialist services and engineering company are bearing fruits across the divisions. TPG Managed Solutions is expected to more than double its profits in 2017, while TPG Engineering and Design & Technology are on course to deliver sustainable profits from 2019. Even if we ascribe zero value to Engineering, Design & Technology and Managed Solutions, the shares are worth 9.5p a share, a 38% upside from the current share price. BUY.
Taking the bull by the horns
15 Feb 17
Avon Rubber announced this morning that CEO Rob Rennie has left and been replaced with Paul McDonald, formerly managing director of Avon’s Dairy division. This news comes as a surprise and is likely to raise some questions over the CEO and CFO transition, with the CEO only being in post for just over a year. However, the group has appointed an executive already known to many who have followed the business, and as such should be seen as a good appointment with a track record of decisiveness and getting things done.
The Slide Rule
12 Jan 17
What is The Slide Rule? The Slide Rule has been designed to dramatically simplify the identification of the best companies in the UK small/mid-cap sector by making a quantitative assessment of the relative potential of each company. At its core, The Slide Rule aims to identify those companies that create genuine shareholder value through strong returns on capital and solid growth, but also present a value opportunity with the potential tailwind of earnings momentum. Companies are assessed within a Quality, Value, Growth and Momentum (QVGM) framework.
Share & share alike
14 Feb 17
The rally in the last fortnight, highlighted in the table, reflects a continued flow of positive updates and economic news. The FTSE 250, Small cap and Fledgling indices have reached record highs. We are in the lull ahead of results for those companies with a December year end, a welter of economic data regarding the UK economy, the State of the Union address in the US on 28 February and the UK Budget on Wednesday 8 March. We will learn at that stage the latest forecasts from the Office of Budget Responsibility. As highlighted previously, the reaction to corporate updates will continue to set the tone.