Building & Construction

Building & Construction equity research

Explore the most viewed and latest equity research and media content for companies within the Building & Construction sector. Stocks in this sector provide goods such as construction materials and offer services from contractors.

Building & Construction equity research

21 Oct 19

Quarterly Research Outlook Autumn 2019

Following continued delays of a Brexit agreement, few sectors within the UK market have remained attractive to investors despite low valuations. One sector which has continued to outperform despite the political drama has been the UK video gaming sector (henceforth UK gaming), which we are fans of. We believe a combination of sector-leading growth, strong cash conversion and timely cyclical positioning support our positive view on the UK video gaming sector.

Companies: ABBY AMS ANX ARS ATYM AVON BLVN PIER BUR CGS CAML CDM CSRT TIDE CYAN DTG DEMG ELM EMR FPO FDEV GTLY GENL GHH GRI GEEC GKP HMI HAYD HEAD HILS HTG HUR IBPO IOG INDI JHD JOG KAPE KEYS KWS KCT KGH LAM LIT LOK MACF MANO MOD OXIG PCA PANR APP SRE PHC PMO RBW RMM RBGP REDD RSW RNO ROR SUS SCPA SEN SHG SOLG SOM SUMO TM17 INCE TWD TRAK TRI VNET VTC ZOO ZTF

21 Nov 19

Cenkos: Breedon Group Plc -- Standing firm, standing out

With the share price off 16.5% over the past month and virtually 25% of the company's equity having been ‘re-housed' over the past quarter, investors are probably craving a period of stability. In trading terms that's exactly what Breedon is delivering. The latest update (to end-October) is reassuring and firmly underpins valuation. As noted very recently (see ‘Stick with the fundamentals', 7 November 2019), Breedon shares have never been as cheaply rated in their entire history; the prospective 2020E EV/EBITDA being c6.4x, PE c11x and a healthy FCF yield of over 9% with nominal FCF sweating debt by over £90m per annum, or helping to support its proven accretive add-on acquisition strategy. In our view, this recent, technical, bout of price depression represents an excellent buying opportunity.

Companies: Breedon Group

15 Nov 19

LIBERUM: Kier Group - Re-assuring statement and no change to earnings or debt

AGM trading statement guides to trading in line with expectations, but now indicates at least £55m of savings in FY 2021. We continue to expect average net debt of £374m for FY 2020, which is clearly key.

Companies: Kier Group

04 Nov 19

THE MONTHLY November 2019

The trade-off in the risk/reward for gold and gold mining equities is improving, as central banks push the current iteration of the post-World War II Bretton Woods financial order towards its limits.

Companies: AVO AJB AGY ARBB BUR CLIG DNL DPP FLTA GTLY GDR MCL MUR NSF PCA PIN SRE PHP RE/ RECI RMDL STX SCE TON SHED VTA W7L

07 Nov 19

Cenkos: Breedon Group Plc -- Stick with the fundamentals

Breedon again finds itself victim of the curse of ‘technicals' rather than ‘fundamentals'. After being caught in the Woodford maelstrom, this time the secondary placing of M1 Cement's 139.7m shares yesterday has de-coupled the price to almost a 12-month ‘low' (and 24% below its ‘high'), where, we believe, the shares are seriously undervalued. On broadly consensus numbers the stock now trades on a 2020E EV/EBITDA multiple of just over 6x and a PE of under 11x with strong FCF potentially paying down debt in excess of £90m per annum. These are ratios that are not only cheap in their own right but also by peer comparison. Once the dust settles on the placing, we believe this price level will prove to have been an excellent buying opportunity and have no hesitation in re-iterating our Buy recommendation.

Companies: Breedon Group

02 Jul 19

Where’s the Value?

Warren Buffett once said that as an investor, it is wise to be ‘fearful when others are greedy and greedy when others are fearful’. Fear is not in short supply right now.

Companies: OPM ALU ANCR BLV CONN CRC STU GATC HAT LEK MMH MCB MWE NXR NTBR NOG PAF PEG RFX SRC TEF TEG TPT VTU WYN XLM

01 Aug 19

Continuing to outperform peers

H1 was another positive trading period for TClarke, with PBT increasing by 24% to £4.6m. The Group continues to make solid progress against its 3.0% operating margin target, achieving a margin of 2.9% in H1 (H1’18: 2.6%). The order book has been maintained at £370m and provides strong support for our full year forecast, which is now 96% covered. Our FY20 forecast is also 50% covered by the order book. This is a strong position against a backdrop of political uncertainty and we maintain our forecasts. The strategy is delivering and TClarke is well on its way to achieving its full year targets. With sustained earnings momentum, we believe the shares will continue to outperform the wider peer group and we reiterate our 150p intrinsic value.

Companies: TClarke

26 Sep 19

LIBERUM: Kier Group - Significant reorganisation

FY19 was broadly in line with revised guidance. But there were £341m of exceptionals, including £172m of disposal-related charges as management simplifies the business.

Companies: Kier Group

07 Oct 19

UK Housebuilding Sector in 3Q 2019: ‘And then there were 17’

Dame Agatha Christie (née Miller) published more than 80 books and plays; and the Guinness Book of World Records lists her as the best-selling novelist of all time with roughly two billion copies sold. ‘And then there were none’ was originally published in 1939, with an un-politically correct title; and it is still the world’s best-selling mystery (with more than 100 million sold). It is also number six on the list of best-selling books of all-time.

Companies: ABBY CSP WJG TW/ BWY PSN GLV BDEV RDW BKG BVS GFRD CRN GLE SPR

21 Nov 19

Cenkos: Breedon Group Plc -- Capital Bridgehead

Breedon has readied fulfilment of its ambition to establish critical mass in the sizeable London ready-mix concrete market via a JV which ensures a lower risk (and cost) immediate presence alongside enhanced future expansion plans. Capital Concrete is an exciting bridgehead for Breedon in a key, under-represented regional market and one that has the potential to double its (pro-forma) scale in the medium-term. Whilst it will not move the dial on group numbers in the short term, it does reinforce our under-valuation arguments made in yesterday's post trading update report. We reiterate a Buy rating.

Companies: Breedon Group

10 May 19

Positive start to 2019 and European expansion announced

TClarke’s update confirms that trading in the year to date has continued to be in line with expectations, having upgraded forecasts as recently as March. The statement reiterates management’s 3% sustainable operating margin target for FY19 and beyond. The order book at £403m (May 2018: £368m, Feb. ’19: £430m) continues to support a strong outlook for the Group and, notwithstanding Brexit uncertainties, TClarke is seeing no lack of opportunities across its end markets. A new venture in Europe is an exciting development and could present upside to forecasts in future periods. We expect strong earnings momentum and revenue visibility to continue to drive the share price and we continue to believe that a premium rating is justified, reiterating our 150p intrinsic value.

Companies: TClarke

17 Jun 19

LIBERUM: Kier* - Accelerated restructuring

Kier has annnounced an accelerated strategic review. Future Proofing Kier has been increased and should yield £55m of gross savings in FY2021.

Companies: Kier Group

01 Aug 19

LIBERUM: Kier Group* - Debt lower than expected for FY19

Following this morning’s announcement, we leave revenues unchanged, given that we are already bottom of the consensus range, but reduce our underlying EBIT by £10m for FY19. Spot and average net debt are lower than expectations for FY19 at £167m and £422m, respectively.

Companies: Kier Group

30 Oct 19

LIBERUM: Volution Group* - Resurgence of environmental drivers

Volution’s shares have re-rated by c.15% as full year results confirmed that the Reading facility is operating normally once again, organic growth has accelerated and margins have stabilised. We see further rerating as these dynamics persist and management tightens its focus on improving margin.

Companies: Volution Group

20 Nov 19

Polypipe - Well-placed but revenue progress moderates

Approaching the year end, slower trading in certain sub-sectors causes us to trim our FY19 earnings estimates by 5% (with more modest adjustments thereafter). This does not change our view that the company is well placed by sector to benefit from some long-term structural drivers in the building materials space.

Companies: Polypipe Group

14 Nov 19

Norcros plc - Interim Results

17 Sep 19

Epwin Group ‘Look compelling’

Premium

06 Mar 19

Breedon Group - Full-Year Results 2018 Interview

25 Jan 19

Capital Goods Value trap – 2019 Outlook

Premium

05 Sep 18

Breedon Group - Half year results 2018 interview

06 Dec 18

Executive Interview - Delignit

25 Jul 19

Breedon Group PLC - Interim Results 2019 Interview

13 Jun 18

Norcros plc - Preliminary Results, Year Ended 31st March 2018

17 Jun 19

T Clarke (CTO) Presentation at Mello May 2019

23 Mar 18

Henry Boot - Full Year Results 2017

12 Jun 19

Norcros plc - Full Year Results 2018/2019

07 Dec 17

Capital Network's Ed Stacey on Morgan Sindall Group PLC

22 Mar 19

Henry Boot - 2018 Final Results

16 Nov 17

Norcros PLC - Half year results for the six months to 30 September 2017

10 Dec 18

T Clarke (CTO) Presentation at MELLO London November 2018

Latest Content

Breedon Group

Cenkos: Breedon Group Plc -- Capital Bridgehead

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21 Nov 19
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Breedon Group

Cenkos: Breedon Group Plc -- Standing firm, standing out

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21 Nov 19
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Polypipe Group

Polypipe - Well-placed but revenue progress moderates

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20 Nov 19
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Small Cap Feast

The Pebble Group, a provider of products, services and technology to the global promotional products industry, announces its intention to seek admission of its shares to trading on the AIM market of the London Stock Exchange, which is expected to take place in early December 2019.The Group delivered revenue of £99.8m in the year ended 31 December 2018.No mention of bottom line and a suggestion that funds raised would provide an exit to private equity shareholders and the repayment of debt. Offer TBA. Longboat Energy raising £10m. Expected admission November 2019. The company has been established by the former management team of Faroe Petroleum to create a new full-cycle North Sea oil and gas company .The strategy to achieve this will initially be through the acquisition of assets where the management team can add value through subsurface and operational improvements, follow-up deal opportunities and nearfield exploration; and by value creation through the drill bit.

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20 Nov 19
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TXP SHG CNIC AAU INSP TSTL ORPH RLE IQG MSMN

Small Cap Feast

The Pebble Group, a provider of products, services and technology to the global promotional products industry, announces its intention to seek admission of its shares to trading on the AIM market of the London Stock Exchange, which is expected to take place in early December 2019.The Group delivered revenue of £99.8 million in the year ended 31 December 2018.No mention of bottom line and a suggestion that funds raised would provide an exit to private equity shareholders and the repayment of debt. Offer TBA. Longboat Energy raising £10m. Expected admission November 2019. The company has been established by the former management team of Faroe Petroleum to create a new full-cycle North Sea oil and gas company .The strategy to achieve this will initially be through the acquisition of assets where the management team can add value through subsurface and operational improvements, follow-up deal opportunities and nearfield exploration; and by value creation through the drill bit.

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18 Nov 19
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Sacyr

9m19: new layer of complexity, right timing for partial divestment of the Chilean concession

The Chilean concessions asset have been partly sold with very good timing but also resulting in a new layer of complexity added to an already complex company. Following these results, we expect to increase our EBITDA, decrease our net profit and increase net debt and capex. Overall, we expect a positive impact on our target price in the vicinity of 5-10%.

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15 Nov 19
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Cementir Holding

Priority to organic growth

Overall, the results were in line with our expectations. Cementir has decided to invest in itself rather than going for a transformative acquisition. Following this earnings release, we expect to make little change to our EBITDA and capex forecast for FY19. We keep our Buy recommendation unchanged. We will review our long-term assumptions a second time but we believe that the industrial plan offers some upside to our valuation, in our opinion.

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15 Nov 19
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Kier Group

LIBERUM: Kier Group - Re-assuring statement and no change to earnings or debt

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15 Nov 19
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Norcros

Norcros plc - Interim Results

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14 Nov 19

Fomento de Construcciones y Contratas

9m 19: no disclosure of lfl EBITDA growth ex-IFRS 16

The absence of disclosure of lfl EBITDA growth ex-IFRS 16 is a shame. The significant net debt increase as well as the many adjustments to be made in net profits means that there are too many moving parts to express a clear impact on our target price, but what we can say is that we intend to keep our Buy recommendation albeit with a lower target price.

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