Industrial Equipment, Goods & Services

Industrial Equipment, Goods & Services equity research

Explore the latest equity research for companies who manufacture industrial equipment, goods, or related services. Sectors include Defense & Aerospace, Electrical & Electronic Equipment, Transport & Logistics, Industrial & Construction Supplies, and Waste Services.

19 Nov 20

Somero Enterprises - Positive update – trading ahead of expectations

The group has released a positive trading update, signalling a strong H2 and performance ahead of expectations. The new guidance points to a 6.7% upgrade to revenues and a 10.5% upgrade to EBITDA. Cash generation has been notably strong, at about $26m, which will drive an increase in supplemental dividends with a dividend yield of 7.1%. We raise our TP from 255p to 285p, based on a target P/E of 14x, giving decent upside to the current 11.6x.

Companies: Somero Enterprises, Inc.

26 Nov 20

DX - Trading ahead, forecasts upgraded

Trading to date in FY 2021 has been positive, with no sign of an adverse impact from the second national UK lockdown. Net new business across both divisions is described by management as encouraging and the new business pipeline remains very healthy. With volumes better than expected and margins improving DX is on track to perform materially better than market expectations and we have, consequently, upgraded FY 2021 EPS by 29% and FY 2022 by 15%, driven by stronger assumptions in DX Freight. We have also raised our FCF-based target price from 29p to 33p and reiterate our view that the group is in a strong position to rebuild profitability by winning new business and improving efficiency, productivity and margins.

Companies: DX (Group) Plc

23 Nov 20

Cenkos: Xpediator Plc -- On the right track

We release prudent FY20E and FY21E forecasts as Xpediator continues to gain momentum and operations revert to pre-COVID levels. The Group has made strategic progress year to date. It has implemented a strict cost reduction programme which should drive annualised cost saving of over £0.5m, restructured and strengthened its management team and further integrated acquisitions. Additionally, it is in the process of consolidating its site portfolio, driving further costs out of the business. We believe the market continues to undervalue Xpediator's geographically diverse revenue base, flexible low fixed cost operating model and positive financial outlook. Accordingly, we move our recommendation from Under Review to Buy.

Companies: Xpediator Plc

23 Nov 20

Cenkos: Directa Plus Plc -- Progress in next generation batteries

Directa Plus has announced that in the October collaboration agreement with NexTech Batteries, it has achieved above 400 Wh/kg (watt-hours per kilogram, the usual measure of energy density) in a practical system. NexTech produced several full-scale pouch format cell prototypes using its proprietary cathode and electrolyte materials (with Directa plus graphene) producing 410Wh/kg of specific energy at a weight only slightly below 30g. For comparison, standard Lithium-Ion batteries have an energy density of 100-265 Wh/kg.

Companies: Directa Plus Plc

23 Nov 20

Rapid recovery in revenues and margins

Xpediator has delivered a healthy trading update, breaking several revenue records during H2 2020. Furthermore, the outlook for FY21 remains promising, reflecting recovery to more normal levels in Transport Services, a full-year impact of the Nidd acquisition, the turnaround of underperforming businesses, and new ventures. The £6m PBT forecast for FY20 highlights an improving margin, albeit this represents a shortfall from FY18. In our opinion management actions, plus recovering markets, can take the Group to peak margins over the next 18-24 months: delivering a marked increase in profitability.

Companies: Xpediator Plc

12 Nov 20

Acquisition, interim results and board changes

Volex has reported interim results that are in-line with expectations following a strong trading update in mid-October. Of far greater significance is today’s announcement of the proposed acquisition of DEKA for a consideration of up to €61.8m on a debt free basis. DEKA is a leading and highly profitable power cord manufacturer, strategically located in Turkey, that serves leading European white goods manufacturers. The acquisition should close in early CY2021, subject to expected Turkish Competition Authority approval. We foresee 15% earnings enhancement in FY2022E with further opportunities for revenue synergies with Volex in the Far East as its operations also vertically integrate, production efficiencies increase and the cost of production falls. The statement highlights that pro forma net debt/EBITDA remains under 0.4x and this provides scope for further bolt-on acquisitions alongside a new $70m RCF and $30m accordion, also announced with the interims.

Companies: Volex plc

24 Nov 20

Trading update – FY’20 profit upgrade

SThree has released a brief update ahead of the scheduled Q4 trading update expected on 12th December. The key headline is that an improving trading backdrop over the last few months has driven a better than expected profit performance. Market consensus was clearly too light with the company now guiding for an FY’20 outcome above the top end of the range of expectations. We have updated our forecasts accordingly and now look for FY’20 PBT and EPS of £28.1m / 13.3p respectively – a PBT upgrade of +53% on our previous estimate. Although the company has not formally reinstated full guidance, we are taking this opportunity to publish our estimates for FY’21. SThree has shown good resilience through this pandemic. The combination of STEM industry specialism and the inherently higher short term visibility of the contract focus has afforded SThree management a greater degree of flexibility when it came to aligning the necessary cost actions with the strategic ambitions of building market share in the key, global STEM markets. Costs and headcount have been cut, but they have been targeted and selective. The net result has been an increasingly positive tone in trading commentary, culminating in yesterday’s explicit upgrade. Has this been fully priced in by the market? To an extent yes, with the shares now standing +57% above the May 2020 lows and outperforming the peer group year to date. However, despite this outperformance (share price and operational) SThree still stands at a material valuation discount to its peers. We continue to find the extent of this valuation gap hard to justify.

Companies: SThree plc

25 Nov 20

SP Angel Spec Sits: Half Year Results (LTHM)

H1F21 revenue was £107m, down 14.8% y/y (H1F20: £125.6m) and down 11.9% sequentially (H2F20: £121.5m). Q2F21 revenue was up 5.3% y/y, indicating a trend to recovery in the post-lockdown period across both, Ireland and the UK. The strength of LTHM's business model is supported by the diversity of its customer base and the expanse of its product offering, allowing it to withstand fluctuations in demand across market sectors. We believe LTHM stock is a relatively low risk investment given the strong cash position (131.6p/share), no debt and a stable yield. The stock trades at 8x EBITDA, compared to its peer average of ~11.1x, on what are more compelling metrics.

Companies: James Latham Plc

19 Nov 20

Macfarlane Group* - Strong Trading Update – Earnings Upgrades

Macfarlane has released a strong trading update for the 4 months to October 31 2020 highlighting second half revenue and PBT to date being ahead of 2019 and the expectation that 2020 PBT will be broadly in line with 2019, a strong recovery from the uncertain position at the interim results. Separately, the Group has announced that CFO John Love will be stepping down from his role and the Board to be replaced by Ivor Gray, current Group Financial Controller and Company Secretary. We expect this to be a seamless transition given Ivor's experience in the Group and represents very well managed succession planning by the Board. Reiterate buy rating.

Companies: Macfarlane Group PLC (MACF:LON)Macfarlane Group PLC (5K6:FRA)

19 Oct 20

Ince Group: Explainer Note – Partner Remuneration

We have today released a new note on The Ince Group plc - this is the first of a series of "explainer notes" that take an in-depth look at the various aspects of the Ince investment case our investors have told us require more clarification. This edition examines the partner remuneration model - the headline for which is that this isn't discretionary bonus, it's more of a revenue share that partners are given in lieu of pay. Thus their remuneration is entirely variable, rather than representing a fixed cost.

Companies: Ince Group plc

23 Nov 20

AFC Energy (AFC LN) - Scaling up

AFC has announced it has secured a long term lease over new premises at its Surrey HQ, which will serve as the Group’s large scale H-Power assembly and commissioning facility. We view this as a positive step forward in AFC scaling up its production to meet strong levels of demand in the current environment. We remain very comfortable with our investment thesis and target valuation of 68p per share outlined in our initiation note in September.

Companies: AFC Energy plc

24 Nov 20

SP Angel Spec Sits: CML Half Year Trading Results

H1F21, impacted by the COVID pandemic, created mixed trading conditions across CML's end-markets, particularly when combined with continuing industry headwinds. However, with solid sales and new orders in Storage markets and a growing product portfolio in Communications markets, supported by a clear strategy focused on enhanced capabilities and internal expertise to increase the size of the addressable market; strong proprietary IP and respected quality/reliability of technology; and continued investment in R&D to grow the product portfolio and in sales & marketing to expand the customer base; it is evident that CML is positioning itself for medium to long-term growth. We believe it is evident that these investments today will allow CML to deliver strong shareholder returns in the future.

Companies: CML Microsystems Plc

02 Nov 20

Cenkos: Seeing Machines Ltd -- FY20 results showing potential

Seeing Machines has announced its FY20 results which show a steady underlying improvement in financial performance with the company surpassing our expectations set in May despite a highly challenging operating environment for the transportation sector. Looking forward, whilst the ongoing pandemic is continuing to affect the business, and we have tweaks to our divisional expectations to account for this, visibility into the path to profitability is increasing and the funding of this has been significantly de-risked by the recent US$20m placement to Federated Hermes Inc. With the risk reducing and the macro environment improving and considerable upside left in our numbers from Aftermarket, Aviation and further technology license deals, we reiterate our Buy and increase our DCF valuation to 8.6p.

Companies: Seeing Machines Limited

23 Nov 20

WHI First Light: AFC Energy (AFC) - – Investment in first H-Power™ Assembly and Commissioning Facility

AFC Energy announced that it has secured a long term lease over a 30,000 square foot (2,800 square meters) hanger and ancillary facilities at its Surrey headquarters at Dunsfold Park to serve as the company's first large scale H-Power™ assembly and commissioning facility.

Companies: AFC Energy plc

26 Nov 20

Capital Access' Hot Off The Wires - The Day Ahead

Today's news & views, plus announcements from AV, BVIC, PZC, RQIH, PMI, MUL, AEXG, INCE

Companies: AEX RQIH INCE

26 Sep 19

Volex PLC 'a resilient, diversified business' delivering strong cashflow

19 Nov 20

Quadrise Fuels International get set for AGM to seize upon opportunities in 2021

07 Jan 20

Volex PLC Investor Presentatiion

17 Nov 20

Brickability

19 May 17

Leading UK fund manager, Gervais Williams, discusses investing, his outlook and two companies he's excited about

11 Nov 20

Strix Group new strategy could bring double digit growth (Analyst Interview)

Premium

01 Oct 20

Itaconix reports 'dramatic turnaround for the direction of the company'

30 Oct 20

Itaconix set to 'continue with progress made this year through to next year'

14 Apr 16

Executive Interview - Martin Aircraft Company

30 Oct 20

Delignit – EKF interview

04 Feb 20

Executive interview - Test

29 Oct 20

Quadrise Fuels International completes industrial pilot for alternative fuel trial in Morocco

06 Dec 18

Executive Interview - Delignit

26 Oct 20

Directa Plus 'captures attention' after years of thorough research, signing NexTech Batteries deal

16 Nov 20

Market Report: FTSE upbeat as Brexit talks look hopeful after Dominic Cummings and Lee Cain removal

Latest Content

Capital Access' Hot Off The Wires - The Day Ahead

Today's news & views, plus announcements from AV, BVIC, PZC, RQIH, PMI, MUL, AEXG, INCE

AEX RQIH INCE

26 Nov 20
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WHI First Light: Norman Broadbent (NBB) - Positive funding update

News from NBB this morning highlights positive new funding arrangements at a time when the company continues to seek growth opportunities both organic and otherwise driven. New facilities include a £250,000 six year loan as part of the CBIL (Coronavirus Business Interruption Loans) Scheme, together with a new invoice financing facility making a further £1.5m available to the company, this last to replace the pre-existing facility (£0.3m drawn down).

Norman Broadbent plc

26 Nov 20
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Morning Note – 26 November 2020

EOG SAV SHOE PPC DX/ TRCS ARB

26 Nov 20
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IoC: Gaining altitude in air quality monitoring

We initiate coverage of Airthings with a Buy rating and target price of NOK 16. Airthings offers market leading indoor air quality monitors measuring radon, mould and other air contaminants as well as energy management solutions to optimize the ventilation system in buildings. The company is trading at a discount to peers with strong revenue growth prospects of 48% 2020-2024 CAGR, which compares to its historical 63% revenue growth since 2016.

Airthings ASA (64J:MUN)Airthings ASA (AIRX.ME:OSL)

26 Nov 20
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DX - Trading ahead, forecasts upgraded

DX (Group) Plc

26 Nov 20
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IoC: Gaining altitude in air quality monitoring

Airthings ASA (64J:MUN)Airthings ASA (AIRX.ME:OSL)

26 Nov 20
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SP Angel Spec Sits: Half Year Results (LTHM)

James Latham Plc

25 Nov 20
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Results and fixtures on the soft side of est.

Q3/20 EPS of USD 0.29 (ARCe: USD 0.32, Cons.: USD 0.35) No DPS declared for Q3 (ARCe: USD 0.23/sh, Cons.: USD 0.23/sh) Q4 fixtures indicating downside to Cons. EBITDA Three new loan facilities signed in November at attractive terms

FRO1 FRLN FRO FRO FRO FRO1N

25 Nov 20
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Weak Q3; fundamentals remain strong

EBITDA of USD 11.7m (-49% vs. Cons)… …as ballast cost and change of technical manager weigh 90% of Q4 days covered at 40k/d, indicating significant upside to Cons Given the miss vs. expectations, we see the share trading lower

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