"We don't keep records of, nor do we hand out awards for, the number of times companies have been crowned as Interactive Investor's Share of the Week. If we did, LSE:ECM:Electrocomponents would probably win hands down.The engineering service ..."
"The combined gross deficit of the Group's defined benefit and retirement indemnity schemes at 31 March 2017 was £104.6 million; this compares to £133.5 million at 30 September 2016 and £43.3 million at 31 March 2016"
Nothing like as bad as BT's but significant - similar size to the operating profit.
Interesting - I wasn't aware of the pension deficit. I will check it out to see how well managed it is. As regards PE I'm not at all concerned by the forward looking view given the newsflow and other fundamentals I can see/read. Dividend is due in a little while too so more than happy hold short, medium and long term unless the story changes.
I've owned ECM in the past; and like the company. Management have done a good job of getting through some difficult times, and it looks like things are finally paying off for them, but to answer your question, "What's not to like?" - the share price. On today's results it gives a PE of 26, and a yield of 2.25%; for an underlying growth rate of under 5%.And they still have a significant pension deficit to deal with. For me that is expensive, and there is better value elsewhere; so I won't be buying at this price. However, if I were already a holder, I would be glad to continue to hold on the back of these results.
When the pre close trading statement was released, I pencilled in a price of 481 as one I would be happy to buy back in on. Whilst I'm encouraged by the actual results and may push up the price at which I'd buy a little bit - 13% is too much.
This company has been on my radar for a while using market filters on some software I use - yield, cash coverage and safety, growth etc. This mornings announcement confirms the positive nature of the trading environment now and in the future plus the share goes ex-dividend at the end of the month I think. What not to like. Bought in this morning.
I'm surprised - read the RNS at 7.30 this morning and expected a 5% jump up, possibly more. It opened up around 3.5%, but look what has happened since. Currently 4.73.
I still can't see what the negatives are in the trading statement. Unless the good news was 'already in the price'. But still then, why the fall - the forward guidance good news is still good news, surely, isn't it? So now it isn't 'in the price'?
Or is it just another case of 'buy on rumour, sell on fact'?
I'd be grateful for help in understanding this.
"Seven months ago, an electronics distributor still worth just a fraction of its dotcom boom valuation grabbed our attention. A recovery in the UK business was underway and big profits were predicted. It duly delivered and, after breaking above ..."
"LSE:ECM:Electrocomponents just keeps outperforming. This is the second time the electronic parts distributor has made our Share of the Week, but with sales growth accelerating and cost savings ahead of plan, margins are stabilising quicker than ..."
well this says everything you need to know about current markets - this is the biggest riser in the FTSE350. Why? Because it came out with a trading statement saying turnover was up by a staggering 1%.
To be fair they also said efficiencies had increased their margins & forex would help lift profits.
But it has come to something when we get excited about a 1% rise in sales!
"Is there value in electronics distributor LSE:PFL:Premier Farnell, given the sale of just one division is fetching 40% of the group's near-Â£400 million market value? Or, is the de-rating prescient of a wider downturn ahead, with electronics ..."
I bought an initial tranche of these today at just over 179 (bought some PFL too). On a ten year chart I think 170 - 180 is a good entry point but on a longer term chart going back to 1999 I get 150 target so I agree with your weak buy. Will buy another chunk if we get to 150.
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