smilingmickey1
06 Sep 2016
Re: Paul Scott likes SOM's results Hi GretelThanks for all the posts following the issue of the interim result this am,I find it quite remarkable that the Somero share price has not responded more positively to the very impressive figures the Company consistently reports. A pe ratio of well less than 10 times 2016 projected earnings with historic profit growth at more than 20% per annum makes this a very undervalued stock. The dividend payout has grown consistently, whilst the Company has been able to maintain a strong cash balance as a result of continued increased cash generation. Furthermore if one is a UK resident whose financial affairs are sterling based, the weakness of sterling in enhancing the value of the dollar based dividend payments Perhaps because the Company is in the construction industry it is valued in the same way and is expected suffer from cyclical downturns. However Somero commands a special niche of meeting the needs of Companies who are required to provide flat floors for their customers. This niche seems not big enough to attract competition and Somero continue to build their competitive advantage to a point where they appear able to increase prices of their kit, whilst still maintaining a healthy and growing order book. My only complaint about holding stock in this Company is that it remains undervalued!.
gretel
06 Sep 2016
Paul Scott likes SOM's results Paul Scott holds and is very happy with SOM: http ://www.stockopedia.com/content/small-cap-value-report-6-sep-2016-som-itq-149475/ Extract:"Valuation - broker consensus is 25 US cents for EPS this year, or 18.7p.So at 169p per share, the PER is only 9.0 for this year.That seems a remarkably pessimistic valuation.Balance sheet - this is in terrific shape, with a very strong working capital position - the current ratio is excellent, at 3.27 - for me, anything over 1.5 is strong. There is $12.1m in cash sitting on the balance sheet, less a small mortgage of about $1m. So the company is in a smashing position overall. My opinion - this is a core long-term holding of mine, so today's results confirm my positive view of the company, and a very low valuation. I think the market was traumatised by Somero lurching into losses in the GFC in 2008. But so did loads of companies. The entire banking system collapsed, for goodness sake. Personally I think it's extremely unlikely that such a severe downturn is likely next time we have a recession. Plus SOM is now in very much stronger financial shape than back then in 2008, so it should be able to withstand anything the economy can throw at it. Essentially this share is a bet on the US economy. If you think it's going into recession, then SOM shares are probably best avoided. If you don't (and you turn out to be right), then this share could be a bargain. Overall, I really like it. This company is the global specialist in a niche market, and given that concrete sets in about an hour, then support & service will always count for a great deal in this sector. Am tempted to buy more actually."
gretel
06 Sep 2016
Finncap increase forecasts today FinnCap reiterate guidance, tweaking earnings up slightly for FY16 due to a lower tax rate:"No change to our trading forecasts that we upgraded recently in July.We have marginally reduced the tax rate from 36% to 35.5%, increasing EPS from 22.5c to 22.7c, up 0.7%.Following a better than expected interim dividend increase, we have raised the FY dividend from 7.2c to 7.6c, up 5.6%. The shares now trade on a P/E of 9.7x in 2016 followed by 9.0x, or – perhaps more importantly – an EV/EBITDA of 5.0x followed by 4.8x. This looks great absolute value for a group seeing structural and cyclical growth drivers, but also great value compared with its peer group. Our recently raised TP of 205p is based on a fair value P/E of 12.0x in the current year and 11.0x in 2017 and offers upside of 24%. The strong interim results, positive outlook and attractive rating all point to the shares being well placed to continue to outperform."
gretel
06 Sep 2016
Terrific results and outlook today Terrific results - almost 10p EPS in H1 alone! Plus on track for a 7.5c dividend, i.e around 5.7p. And SOM have an $11m cash pile.And crucially:"the solid activity levels from H1 2016 have carried over to July and August as we continue to see significant opportunities across our broad portfolio of markets"China is improving nicely, the USA is roaring away and other weaker areas are seeing signs of growth.SOM are managing expectations nice and conservatively, but forecasts of 17.1p EPS this year look like being well beaten imo:[link]
smilingmickey1
05 Sep 2016
Re: Results tomorrow Thanks for the reminder Gretel.I'll be very interested in how the business in China is developing and expect the USA to be particularly strong!
gretel
05 Sep 2016
Results tomorrow Results tomorrow - remember this from July's trading statement:"The strong performance in June and the continuation of the positive trading environment together with margin improvement and solid operating cash flow generation mean the Company now expects to report results slightly ahead of current market expectations for the full year ending 31 December 2016"
smilingmickey1
28 Jul 2016
Re: Finncap's new increased forecasts Hi Gretel,One of my brokers has suggested that I open a trading account and transfer my Somero shares from my ISA account into it. The dividends can then be deposited and held in a dollar account awaiting future use. All done at no cost.It would appear that ISAs are not permitted to hold funds in anything other than sterling hence the immediate exchange of the dollar funds into sterling with the associated exchange rate costs.Yes you are right the weakness of sterling favours holding stocks like Somero. So hopefully a small double whammy for me, but also helpful in planning where to hold overseas stocks which pay dividends in future!SM
gretel
28 Jul 2016
Finncap's new increased forecasts Finncap's increased forecasts are now up on Hemscott in pence as follows: this year : 17.01p EPS, 5.44p dividend next year : 18.60p EPS, 6.12p dividendSmiling mickey, I think Brexit has done your work for you in getting improved exchange rates for the divi 
))
smilingmickey1
25 Jul 2016
Re: Moving up - new all-time highs soon? Hello Gretel,We seem to be in all time high territory today.The chart says that the RSI is just below 70, which to me suggests there may be a bit further to go in the short term. At the moment I hold my shares in 2 ISAs and am trying to figure out a method of securing a better exchange rate for the divis before the next deposits are due. Any thoughts you have most welcome.SM
gretel
22 Jul 2016
Moving up - new all-time highs soon? SOM moved up yesterday and today after an earnings beat from United Rentals in the USA FYI. It shows a strong north American construction market. Ashtead was the biggest riser in the FTSE100 yesterday for the same reason.
gretel
19 Jul 2016
Finncap increases target to 205p Finncap has now increased its price target to 205p (from 185p):[link] group recently confirmed a strong end to its first half trading, and now expects trading for the full year to be ahead of expectations. Accordingly, we upgrade our 2016 EPS forecasts by 7.5% and in 2017 by 4%. With a strong second half expected from good momentum in underlying markets, plus better H2 cash generation, the shares continue to look great value. The shares look cheap and we continue to see strong upside over the next year.""Growth on track to 2x sales by 2018 - giving profit up 3x. China steady, new products spurring on demand - plenty of scope. Investment to scale up business continues. Rating looks too low, given the recent reassuring trading update."
gretel
19 Jul 2016
Ticking up on large volumes Good to see a tick up today after some large share volumes going through.Finncap's forecast EPS per Paul Scott is 22.5c, i.e 17p EPS.With around 17p per share of cash, if you strip out that cash pile the adjusted P/E at 163p is still only 8.6 for the current year.
claude reins
15 Jul 2016
Covered in a feature on Stockopedia... ......along with Cambria MotorsSIF Portfolio: I add Zulu pick Cambria Automobiles, plus an upgrade for Somero
claude reins
15 Jul 2016
Covered in a feature on Stockopedia... ......along with Cambria MotorsSIF Portfolio: I add Zulu pick Cambria Automobiles, plus an upgrade for Somero
gretel
14 Jul 2016
Shares Mag says Buy today Shares Mag today has a "Play Update" on SOM and says "keep buying": "SOMERO ENTERPRISES (SOM:AIM)US-BASED MACHINERY manufacturer Somero Enterprises (SOM:AIM) has announced that it is trading ahead of market expectations for 2016.The company makes patented laserguided equipment which automates the spreading and levelling of concrete for commercial flooring. We added the company to the Plays portfolio as a tangential beneficiary of the e-commerce trend.We believe the continuing shift towards online shopping will drive demand for its expanding product range which can create the almost perfectly flat concrete floors required in retailers’ warehousing centres.The latest update on 12 July 2016, which follows a robust statement last month (6 Jun), suggests the first half has ended strongly with June seeing good trading volumes in the US, Europe and China.House broker FinnCap has upgraded its pre-tax profit forecast from $18.9 million to $20.3 million.Canaccord Genuity, which rates the stock a ‘buy’ and recently increased its price target to 200p, comments on the positive valuation implications of sterling weakness: ‘With numbers reported in USD and a GBP share price, the shares are now trading at an increasingly attractive multiple, with a price to earnings ratio of 7.9 for FY16E and a free cash flow yield of close to 10% in FY17E as capex normalises.’SHARES SAYS:We are encouraged by the performance of the business. Keep buying. (TS)"
