Wealth4u
17 May 2018
ADM This sort of manufacturing is a disruptive force in manufacturing. how will it impact RSW? And When will it be a major driver of revenue? Metrology is always needed, even if machines age this component will need upgrades etc. So how are these dynamics to play out? I do not know. RSW just looks too expensive.
tomhawbuck
16 May 2018
Re: Profits up, cheers LKH You were right about the out-performance and I apologise. I was using the LSE graphing tool which only goes back 5 years and that does show that the current phase of out-performance did begin in 2016.I sold before they peaked and after the price fall in Feb, I bought back in. A rare piece of luck. Normally I sell just before a share price rises and buy before it falls. I think they are an excellent company but I have two concerns - I think that they are probably a cyclical company and I am also worried about an apparent lack of a succession plan for the company founders. As I said, I am going to hold onto them but keep a watchful eye.
picstloup
16 May 2018
Re: Profits up, cheers LKH if you plot their share price against the FTSE or any other index you like, you will discover that this amazing out-performance only began in 2016 and has lasted for 2 years. I think that believing it will continue may be an example of confirmation bias. I shall watch their price and performance like a hawk and fly away at the first sign of a downturn - says tomhawbuck__________ ___Possibly, possibly, but in that case I'm curious to know why you didn't sell up when the price dropped ~20% back in February?Also, the "amazing out-performance" didn't begin in 2016, it's been going on for well over a decade: 2003 price £4.10, FTSE 4050, 2008 price £7.65, FTSE 6261, 2010, price £12 FTSE 5935, 2014 price £15.50 FTSE 6740, etc etc
tomhawbuck
15 May 2018
Re: Profits up, cheers LKH The problem is that this bull market has run so long that it is hard to see what would happen in a downturn. When I was at the London School many years ago we were taught that machine tool makers were highly cyclical because as demand slows, manufacturers stop ordering new machine tools and run their old machines for longer. Given the global nature of the economy, this would affect all of RSW's markets at once. I'm not sure what has changed to alter this scenario, but wdik. What I do know is that if you plot their share price against the FTSE or any other index you like, you will discover that this amazing out-performance only began in 2016 and has lasted for 2 years. I think that believing it will continue may be an example of confirmation bias. I shall watch their price and performance like a hawk and fly away at the first sign of a downturn
SundayTrader
10 May 2018
Re: Profits up, cheers LKH Thank you - interesting comments.Going back to the seventies, my recollection was of machine tool manufacturers being acutely sensitive to the economic cycle, and more recently of Renishaw being signficantly impacted in 2010. It is a good point that these days the timescales for purchase of this sort of equipment are longer.In Renishaw's case I think that their global spread gives them a fair degree of insulation from economic cycles - in recent years if one geographic area has been lagging, another has been strong. And the probe is anyway a much lower cost item than the machine tool.
nettle124
10 May 2018
Re: Profits up, cheers LKH I think LKH will be back as soon as he gets bored doing whatever it is he is currently doing. He might not be so happy to return to this particular board though.
red fox
10 May 2018
Re: Profits up, cheers LKH I wonder if good performance and a weakish pound increases the chance of a takeover. A Motley Fool article last year highlighted that the chairman and deputy chairman are both in their seventies and together own half of RSW shares, so might be open to a retirement sale.
Bertie Biddle
10 May 2018
Re: Profits up, cheers LKH SundayTrader"Yes, missing LKH's thoughts as well."I suspect we all are and can only surmise LKH has shuffled off as they say?But remember that LKH sold his shares in RSW much to his later regret although he continued to proclaim the merits of the company.It depends what you mean by "capital goods business". I would rather define them as a supplier to capital goods companies, principally machine tools manufacturers for their metrology products which are currently their main source of income .Future growth may be in their health care division which is approaching profit and 3D printing.Being a supplier to machine tool manufacturers globally means that it is not subject to regional blips in new investment. Modern machining centres have delivery dates of years not months and their customers may be years in their planning so that economic cycles are to some extent irrelevant. A probe for a new machine tool would be the last thing delivered although would be specified with the order.You are therefore correct in that they have limited forward visibility of revenue but they are almost an automatic choice for measurement, the Kellogs Cornflakes of probes and their software.
SundayTrader
10 May 2018
Re: Profits up, cheers LKH Typical tight-lipped Renishaw update, just tells you things are going well. Seems to have caught Mr Market a bit on the hop, he seems to have been expecting some sign of the much touted economic slow-down. However, Renishaw is a very lagging indicator - they have pointed out in the past that they have limited forward visibility of revenue. They are clearly good for this year, but are obviously very much a capital goods business. Still, not selling myself.Yes, missing LKH's thoughts as well.
picstloup
09 May 2018
Re: Profits up, cheers LKH Very nice to see this back in the mid £50s. Think it needs to hit ~£70 before we get into the FTSE100 (before today's rise we were at place 123).
red fox
09 May 2018
Profits up, cheers LKH Nine month trading update - statutory profits up 49.8%, with metrology doing particularly well. Outlook for the year revised higher.This was a LK Hyman tip - I raise a glass in thanks. I miss his musings from the flybridge.
red fox
10 Apr 2018
Peel Hunt 'superb business' Peel Hunt analysis (from Hargreaves Lansdown)On Renishaw, which Peel Hunt referred to as a "superb business", the analysts gave it a "premium rating", but noted it was "not bullet-proof", and that its communication with the market had not always been sufficient for it to feel completely comfortable with its forecasts. Peel Hunt singled out some longer-term concerns about Renishaw's management succession scenarios, but noted that as shares were coming back to within 5% of its target price, it made the move to bump its recommendation back up to 'hold'. Renishaw itself anticipates full-year revenues of £575-605m, and a pre-tax profit of around £136-156m, while consensus was at £599.6m and £140.1m, while the broker itself had pushed for £601m and £144.5m. The analysts highlighted that Renishaw's key to profitability will be its progress in Healthcare, which it expects to break even by the end of FY19E. "Our TP equates to a PER of 24.6x FY19e, a premium that reflects the quality of the Renishaw business," the analysts concluded.
red fox
05 Apr 2018
Goldman tips RSW to join FTSE 100 From Hargreaves Lansdown today.'Factory equipment manufacturer Renishaw is going to be the fastest growing company in European capital goods sector over the next three years and catapult itself into the FTSE 100, said Goldman Sachs as it initiated coverage on Wednesday.Renishaw, whose devices and sensors are used in factory automation for highly accurate measurements of products and the calibration of machine tools, was given a 'buy' rating by based on Goldman's target price of 5,500p.Analysts pointed out that the 50% sell-rated consensus and concerns associated with the firm's margin potential and valuation were "unwarranted".Analyst Jack O'Brien argued that Renishaw's sector premium was, in fact, justified in light of Renishaw's speed of growth and potential as a M&A target.O'Brien highlighted Renishaw's products' ability to increase factory production yields, improve time-to-market and enable the continuous manufacturing feedback loop as providing a major market opportunity in Asia, where China is actively trying to promote high value-add manufacturing. He said this was a key driver into what was seen as a £1.5bn market opportunity by 2020.The analyst expects growth of 30% per year from the sector, with Renishaw likely to add scope for new products to unlock the mass-production market.'
SundayTrader
25 Jan 2018
Re: Solid Half Year Report Having looked a bit more closely, I think these are really good results. I agree with every point you make, no point in my repeating them.At a price of 49, I put the forward P/E ratio at around 32. That is demanding, and I can see the logic in your switch to IGG. I won't follow your example, because one of my rules is never touch financials, so I will continue to hold despite being well over-weight. I don't think the rating is excessive for the business.I have a theory that low staff turnover correlates well with business success - unfortunately that is something we can usually only guess at from the Annual Report.
once a week
25 Jan 2018
Re: How did the buyers know? The results are very good.This is simply some profit taking.I've bought in on the expectation that the share price will recover very soon.As with others I've been invested a long time with an excellent return, even without taking the dividends into account.
