Kier Group - KIE Stream Log

Kier sold one property in London yesterday and made £25m, enough to reduce group net debt from £167m to £142m, which is very low for a company with current turnover of £4.5bn. Order book is strong with £9.4bn in projects of which 90% are secured and probable. In addition to that, there's a logjam of projects waiting in the wings due to brexit uncertainty (so industry analysts say). Once that gets unclogged, Kier is likely to grow massively. But the firm doesn't need to grow for the share price to perform. It only needs to show debt reducing, and that's being accomplished by asset sales, small and large, and retaining the dividend which has been over £60m a year recently. If anyone here wants to know what Kier is doing in terms of growth and business strategy, all the answers are easy to find. Just take a look at the preliminary results on the investor results page of the company's website and if you want to hear the analysts grilling the CEO, there's a webcast too. Also, Andrew Davies has just put out a youtube video aimed at Kier staff, in which he discusses the direction of the business and the share price. Not hard to find. Dyor.

The share price is a stone cold bargain. Either it goes to £6 or the firm gets a speculative bid from a buyer. I don't see it staying at £1.20 for much longer. A lot of the promises from government involve infrastructure spending (hospitals, schools) and its record this yr, when business is supposed to be hamstrung by brexit, is that its beating all of the other construction firms and is having a good year. Andrew Davies essentially smashed the results down this year with massive paper writedowns and provisions and the next H1 results will show him as a massive success.

No. The business has more than enough cash; Kier is using only half of its available credit line; its paying suppliers almost twice as quickly as it was six months ago; and its retaining £60m+ in dividend cash that it would have paid out to shareholders. In terms of 'downsizing' it's only a reduction of about 10% of turnover. Kier Living (the residential housebuilding division) turned over about £400m out of the firm's total £4.5bn turnover last yr. The most amazing thing about all of this is that Kier Living is for sale at around £160m (with four or five 'very engaged buyers') but the total market cap of the whole £4.5bn business as it stands today is about £180m. Kier is hugely undervalued; the major part (the construction firm) is effectively valued at about £25m for a business which is the second largest regional construction business, turns over £4bn+ (yes, billions) with underlying annual profits of £100m+, and has been growing organically this year through winning more contract work by value than any other construction firm. Workforce has grown by over 10% by my reckoning. Last yr was 18,000, this year over 20,000.

They won't be selling it cheap. More liekly they won't sell it at all. The sale doesn't make a lot of sense to me; profitable division. Why sell it for £160m? Why buy it for £160m when you can buy the whole company for somewhere around £300m (assuming the share price were to double on news of a bid). I don't think Kier even NEEDS to sell Kier Living. Remember, they're saving over £60m a year through the cancelled dividend. All they need to do is keep making money. Kier is essentially a management company. Their subcontractors do all of the physical work. The Kier staff just do the work-winning, planning and overall management. The entire Kier workforce amounts to an average of around 20 people on each project. All they need to to do is keep on, keeping on. Avoid buying any more companies. Avoid getting involved in any loss-making contracts. This company will make its way back to £2 shortly in my view, probably before year end. I'd like to see a trading update in a fortnight or so.

Actually the divisions have been for sale since June, not January. Listen to the analyst briefing on the sale progress. It will be done by the end of the year. The loss btw was mostly on paper, not so very real. All writedowns and future provisions. So your doubts are NOT well founded. I suggest you do a bit of reading.

There is no 'restructuring' and no reason for the cabinet office to trouble itself with Kier. All Davies is doing is selling some Kier businesses. The company is solvent, debt is reducing anyway, it has plenty of financing and only draws on about half of its available credit. Nothing to see here. Just the UK's second biggest construction firm continuing to build schools, hospitals, commercial parks, roads etc all over the country. The share price will now recover steadily, maybe with a quick rise when the residential homes business gets sold.

If you're genuinely interested in hearing them 'come clean' you can listen to the analyst presentation. It will take an hour of your valuable time though; so it might just be easier to fling a few dumb comments onto this board about nothing in particular. They've provisioned for practically every single thing you could think of, including the cancellation of HS2. Kier Living isn't being sold piecemeal; it's got a £163m asking price; they have approx five bidders for the business; it doesn't include £10m of 'mothballed' land which I think is land that has been written down from £50m. Anyway, dyor and then maybe express your thinking.

Big jump in the Kier share price today. Up 21p and over 17%. No news that I can see. Break-out well established. I reckon it's gonna be a steady climb now to Thursday next week and beyond. £2 by Friday week.

Fairly big day for Kier shares today; up 5.5p almost 5% on increasing volume. Share price looks like it's broken out, finishing above 120p, ahead of results due on Thursday next week. Since the current p/e is around 1, if the results show that the business has made any profit and is not bust (all the signs are that debt is reducing and there will be some profits) I'm expecting this to take off in spectacular fashion. I was hoping to buy on a dip, but Kier got a lot of attention a few weeks ago with its trading update, so I might have to grab some at tomorrow's price. Hedge funds were shorting and one has exited completely, in anticipation of share price recovery. The others might be following.

Shorters haven't been 'flushed out'. It's the most shorted stock on the market. But some of the hedgefunds shorting kier are reducing their short. Current share price suggest that the company is going bust like carillion and interserve, but that was just the market making an obvious conclusion months back. Instead, according to the last trading update, debt is reducing. If the company isn't bust, this is underpriced by a factor of 3 or 4 at least. You've presented no facts to support your claim that 'this is going to zero'. Kier keeps winning contracts and is reportedly paying suppliers early! They had a rights issue none months ago and cancelled the dividend. Rights issue was £250m and the dividend last yr was about £67m. All of that money has gone into cash and is being used to reduce supplier payment days (down from massively from 57 to 41 days) and reduce debt. Results are out on the 19th. That's why the shorters are reducing. Kier isn't going bust and will likely be rerated on the 19th. Broker note from Peel and Hunt have a short term target of £2. So it's not 'a shorters' dream'. It might be a shorter's nightmare though.