ALS Ltd - ALQ (Was Campbell Bros, CPB)

[macduffy]

Anyone else here holding CPB?

They're making a 1 for 6 renounceable cash offer at $22 ( a 25% discount to the last traded price of $29.59 ) to fund a takeover offer for Pearlstreet.

CPB is a leading provider of laboratory testing services to the mining,oil and gas, environmental, life sciences and other sectors through its subsidiary, ALS Laboratory Group. Pearlstreet (PST) is apparently the leading Australian company in "non destructive testing" ( whatever that entails!)

Disc: I've held CPB since February 09 for about a 150% gain.

;)

[sharer]

Anyone else here holding CPB?
They're making a 1 for 6 renounceable cash offer at $22 ( a 25% discount to the last traded price of $29.59 ) to fund a takeover offer for Pearlstreet.
CPB is a leading provider of laboratory testing services to the mining,oil and gas, environmental, life sciences and other sectors through its subsidiary, ALS Laboratory Group. Pearlstreet (PST) is apparently the leading Australian company in "non destructive testing" ( whatever that entails!)
Disc: I've held CPB since February 09 for about a 150% gain.
;)

This has been on my watchlist for review about every two weeks all thru the year, but i don't yet hold any. The business seems quite attractive, even "defensive" (would you say MacDuffy?).
Unfortunately my guesses at TA entry points have never happened at a time when there was any money available, and as something of a newbie still i haven't had the confidence to sell up a stock working well & jump into CPB instead.
Now you point out the opportunity with the new issue, i think i'd better do my sums again. It might be a good plan to dump one of my risky things in favour of CPB, which i feel is more basic & diversified.
Also, i have a long attraction to profitable essential service firms like PST that are needed for the big miners or CSL etc to succeed. It will further strengthen the character of CPB's business as i see it. (Another such favourite of mine is MND - there's enough upsy downsy for patient capital plays, plus div-yield of 2 - 4X the likes of BHP or CSL e.g.).

[Dr_Who]

What a nice looking graph on CPB.

Hey Mcduffy, how come you didnt tell me to buy this one? lol :p

[macduffy]

What a nice looking graph on CPB.

Hey Mcduffy, how come you didnt tell me to buy this one? lol :p

C'mon, doc, you can't kiss all the girls!

As you can see from the chart CPB hit a SP of about $38 around a year ago and then went into decline ( along with a lot of others!).
I bought in February but have been sitting with my finger on the trigger ever since, determined to protect my profit if it started to backslide.I'm a bit surprised that the market has taken this issue and takeover so well with the SP up again after the announcement but I'll take it and be grateful.

I bought because it seemed to me to be one of those quality stocks which were dealt with unduly harshly by the market. Not sure I'd want to be getting in now at $30+ although the shares are cum rights at present ( ex rights on 6 October).

As always, DYOR.

[macduffy]

Well, the board of PST has rejected CPB's offer. With the MD holding 50.7% of the capital, that looks pretty conclusive unless CPB come up with a better offer.

I might have a look at PST although their SP took off a couple of days ago on plans for a recapitalisation and will no doubt do so again now.

[mark100]

Well, the board of PST has rejected CPB's offer. With the MD holding 50.7% of the capital, that looks pretty conclusive unless CPB come up with a better offer.

I might have a look at PST although their SP took off a couple of days ago on plans for a recapitalisation and will no doubt do so again now.

I picked up some PST 2 days ago the morning they announced the Private Equity deal at 34/35c. Very happy to see CPB have shown there hand so soon. Hoping for a bidding war although I never got as many PST as I wanted. Did get a few PSTO as well

[macduffy]

A good pick, Mark.
:)

Looks like the makings of a bit of a fight for PST.

Here's today's article from The Australian.

http://www.theaustralian.news.com.au/business/story/0,28124,26152434-16941,00.html

[mark100]

A good pick, Mark.
:)

Looks like the makings of a bit of a fight for PST.

Here's today's article from The Australian.

http://www.theaustralian.news.com.au/business/story/0,28124,26152434-16941,00.html

Sounds like the PST MD wants to keep his job and with 50% of the shares its hard to argue with him. Looks like more cash is needed before he'll take an early retirement. I'm not sure how important PST is to CPB, but obviously I'm hoping for a higher bid to get him onside

[/I]

[mark100]

Sounds like the PST MD wants to keep his job and with 50% of the shares its hard to argue with him. Looks like more cash is needed before he'll take an early retirement. I'm not sure how important PST is to CPB, but obviously I'm hoping for a higher bid to get him onside

[/I]

Thank you CPB. I've been soaking up a few PSTO the past few weeks mainly because of the arbitrage opportunity when converting to PST but also because I thought CPB could return with more cash.

[macduffy]

Well done, Mark!

I had intended to do something similar but took my eye off the ball - watching gold stocks, I think :confused: - so missed out.

Will have to be satisfied with the great run that CPB's giving me. I applied for over-subscription in the rights issue, but not much chance there I would think with the rights trading around $5!

[soulman]

Thank you CPB. I've been soaking up a few PSTO the past few weeks mainly because of the arbitrage opportunity when converting to PST but also because I thought CPB could return with more cash.

Sic Mark and congrats at the same time. I missed, I missed and I missed. 3 strike and you are out. On Wed or Thurs last week, someone had 100K PST for sale at 52 cents. I said to myself, I'll have some of those before that 1 cents div this week. But suddenly, I let my eye off this girl and she got away.

2 easy misses this year - BRG and PST. What a donk.

[macduffy]

The consolation prize for CPB holders is that the SP is up 63c today in what is a pretty dismal market. A combination of approval of the Pearlstreet business and the end of rights trading? More the former, I suspect.

[mark100]

Sic Mark and congrats at the same time. I missed, I missed and I missed. 3 strike and you are out. On Wed or Thurs last week, someone had 100K PST for sale at 52 cents. I said to myself, I'll have some of those before that 1 cents div this week. But suddenly, I let my eye off this girl and she got away.

2 easy misses this year - BRG and PST. What a donk.

I thought something was up with PST yesterday. A few keen buyers around and I had the chance to buy more PSTO at 13c but figured I had enough. Doh!

I missed BRG as well soulman. Had it on my list as a near certain takeover play but never got around to buying. If Solly Lew doesn't accept and the BRG price falls I might buy a few. I remember what happened with Lew and Colarado a few years ago. Lew got mopped up later on for a nice profit.

[h2so4]

Thank you CPB. I've been soaking up a few PSTO the past few weeks mainly because of the arbitrage opportunity when converting to PST but also because I thought CPB could return with more cash.

I thought that too but didn't do anything about it. Well done mark and macduffy.

[h2so4]

Arbitrage??? Buy PSTO at .36 and pay the exercise price of .36 then sell back to CPB for .75. A 4% profit, if it happens in a one month time frame, that makes it a 48% pa return. Reading the announcements there appears little chance the TO will not complete. A no brainer perhaps but even the smallest chance that it doesn't complete makes it too risky for me.

Good Luck!!!!!!!!!

[macduffy]

Well done, Mark!

I had intended to do something similar but took my eye off the ball - watching gold stocks, I think :confused: - so missed out.

Will have to be satisfied with the great run that CPB's giving me. I applied for over-subscription in the rights issue, but not much chance there I would think with the rights trading around $5!

Much to my surprise it looks like CPB shareholders who applied for oversubscription have struck paydirt!

The issue closed oversubscribed but those who took the chance have been allocated up to the lesser of 2129 shares or three times their entitlement.

Not a bad deal at $22 with the shares now trading at over $28!

;)

[winner69]

Plenty more action to come here methinks

Press says Orica interested .... let CPB get over the latest takeover activity and may be all on again

[macduffy]

Yes, winner, it's certainly all action with CPB with takeovers of Pearl Street and Ecowise in the last year although the bid for AEC seems to have hit some opposition.

But what's this about Orica? The only articles I've seen are linking Orica with NPX.

[winner69]

Think ORI have had CPB on their radar for a while to add to their mining services (beyond explosives) business ... like Minova isn't an explosives business but do a lot of in mine engineering

CPB would be good for ORI..... maybe hocking off the Chemicals business to pay for CFB?

[macduffy]

Think ORI have had CPB on their radar for a while to add to their mining services (beyond explosives) business ... like Minova isn't an explosives business but do a lot of in mine engineering

CPB would be good for ORI..... maybe hocking off the Chemicals business to pay for CFB?

Right, I see the connection.

CPB has an M/Cap of almost $1.9b but I guess a company of ORI's size would be able to handle that. A bit more, actually, as I'd be expecting rather better than current SP!

Cheers

[winner69]

Much to my surprise it looks like CPB shareholders who applied for oversubscription have struck paydirt!

The issue closed oversubscribed but those who took the chance have been allocated up to the lesser of 2129 shares or three times their entitlement.

Not a bad deal at $22 with the shares now trading at over $28!

;)

Shareprice still pretty strong .... just makes that takeover target bteer value for their shareholders eh

And don't forget ORI are waiting in the wings to take out CPB at some time .... even though it may be getting a bit expensive but would underprin the shareprice for a longer term hold

[macduffy]

From FN Arena.

"CPB - CAMPBELL BROTHERS LIMITED
Credit Suisse rates CPB as Outperform (1) - Target $39.00 (was $37.20). Currency movements have seen the broker adjust its earnings estimates slightly lower but a change in valuation method has seen an increase in price target.
The backdrop for minerals testing remains positive in the broker's view and this offers scope for further outperformance from current levels. Any gains in the next 3-6 months are likely to be incremental given the positive bias of market recommendations.

Target price is $39.00 Current Price is $33.12 Difference: $5.88 If CPB meets the Credit Suisse target it will return approximately 18% (excluding dividends, fees and charges).

The company's fiscal year ends in March. Credit Suisse forecasts a full year FY11 dividend of 133.10 cents and EPS of 190.10 cents . At the last closing share price the estimated dividend yield is 4.02%.

At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 17.42.

Market Sentiment: 1.0 "


CPB's takeover of Ammtec looks to be a goer now that the Ammtec board has endorsed the increased offer

[macduffy]

Doesn't seem to be much interest in CPB here but they power on, nevertheless!

One of my better buys (at around $12) in recent years.

From FN Arena.

"CPB - CAMPBELL BROTHERS LIMITED
Credit Suisse rates CPB as Outperform (1) - Target $41.30 (was $39.00). The broker has added Ammtec to its model and adjusting for this and currency movements sees minor changes to earnings forecasts.
Lead indicators for the Minerals division remain strong and so the broker retains its Outperform rating. Price target has increased to reflect an increase in peer multiples.

Target price is $41.30 Current Price is $35.25 Difference: $6.05 If CPB meets the Credit Suisse target it will return approximately 17% (excluding dividends, fees and charges).

The company's fiscal year ends in March. Credit Suisse forecasts a full year FY11 dividend of 133.40 cents and EPS of 190.20 cents . At the last closing share price the estimated dividend yield is 3.78%.

At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.53.

Market Sentiment: 0.8 "

[macduffy]

Another stellar result from CPB!

Interim NPAT up 73%, increased interim dividend of 65cps.

Anyone else sharing my good fortune here?

[drillfix]

Not unless you can be generous enough to do an off market transfer at issue Macduff :P

For a moment on looking at the Market Depth, I it appears to be Algorithmic bids as they are tiny bids.

I thought Bots mainly came off screen, but now they are in cue's LOL

Tell ya one thing though, love the chart :)

[glennj]

Doesn't seem to be much interest in CPB here but they power on, nevertheless!

One of my better buys (at around $12) in recent years.

From FN Arena.

"CPB - CAMPBELL BROTHERS LIMITED
Credit Suisse rates CPB as Outperform (1) - Target $41.30 (was $39.00). The broker has added Ammtec to its model and adjusting for this and currency movements sees minor changes to earnings forecasts.
Lead indicators for the Minerals division remain strong and so the broker retains its Outperform rating. Price target has increased to reflect an increase in peer multiples.

Target price is $41.30 Current Price is $35.25 Difference: $6.05 If CPB meets the Credit Suisse target it will return approximately 17% (excluding dividends, fees and charges).

The company's fiscal year ends in March. Credit Suisse forecasts a full year FY11 dividend of 133.40 cents and EPS of 190.20 cents . At the last closing share price the estimated dividend yield is 3.78%.

At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 18.53.

Market Sentiment: 0.8 "

I'm interested. This has been a great share. Bought in at just over $4 in year 2000 and sold out in 2007 at $23.05 to help pay cash for a house. Got back in at $13.25 but only have a relatively small parcel this time. Am sitting on a paper gain of AUD $30000 tho so not too bad. The ROI of this stock has been amongst the better ones in my AU portfolio.

[mark100]

Wow nice result from CPB. I don't hold any unfortunately. Even with the rate of growth the PE is too pricey for me to buy in although if I already held I'd probably hold on for some more. Well done to those still holding

[macduffy]

Yes, indeed!

NPAT came in exactly mid-range of the (upwards) revised guidance on 29 April. Actual $132.3m, Guidance $130 - $134M.

This market's hard to please at the moment though and promptly marked the SP down a peg or two.

I'm holding.

[drillfix]

Excellent Chart on this CPB.

Although, I personally would advise caution from here in people.

Why? lower highs and lower lows starting to show or become apparent. but the true signs will be seeing price break through the 60ema with the 13ema also breaking through, which may show a new trend starting present itself.

But then again, most of the trades look like BOTS just playing around but at 45+ bucks a share then maybe not, Although there are many trades of 2 and 3 shares rolling around.

I dont hold but watch.

[winner69]

Orica will buy them one day .... when they get their head around how much more it will cost them than a year or so ago

[macduffy]

The Australian reports on CPB's result.

http://www.theaustralian.com.au/business/campbell-collects-as-investment-pays-off/story-e6frg8zx-1226062257538

And thanks for your thoughts, drillfix. TA comments always appreciated!

[drillfix]

Hey, no worries there Macduff.

TA is very helpful in seeing potential warnings and issues that show up in a stock Technically, but there is never any guarantee, but more rather, probability if any. As stocks can be manipulated or traded by Algo Bots to make it appear to do one thing or another.

So we just look at the daily of of CPB taken my IB platform and mark out some of the Potential Warnings technically that tell us of certain cautions to look for which can save you a bundle, depending how much you hold or what position anybody has taken.

Here is a chart:

CPB Daily chart > http://www.imageurlhost.com/images/zx5k2msfs2s0xyavdxk_CPB-Daily.png

CPB Daily Zoomed> http://www.imageurlhost.com/images/5hxzvpwprmqjyc56ujid_CPBzoomed.png


Start form the bottom and work our way up.
MACD signal lines increases each time frame moving forward giving upward divergence as we reach what appears to be the top and then finally breaks down heavily, giving an indication that a top may have been reached. A typical sign.

DMI was also declining during the MACD decline then showed a potential cross or change in direction yet repelled bounced negative. Another sign.

Wiliams %R had been trading for the longest time up above the 50 line for the primary part of the upward run from 30+ dollars. it had broken down past the 50 centre and retested a the overbought area as many had thought it was a bounce, only to be convinced it was not and then it become immediately oversold and once again below the previous maintained above 50 line. Yet another sign.

RSI showing slight negative divergence from the Top moving down towards 40 level, any weaker will show further weakness of course.

OBV also showing total negative divergence from the top, BUT if you look closely you will see it happens a couple days prior to the bigger falls, which was a good signal using all the other combined signals which all add up.

PRICE. (the true indicator in real time)
As you can see from the left, you can see the price climb like its walking up stairs. Higher Highs, Higher Lows, and again all the way until we see a top formed.

The same holds true for a fall except the opposite.

Price starts its decline, and all the indicators above mentioned trigger warnings, a Lower High is created, then a Lower Low, and then a Lower High again and then a Lower Low again.

Question is, how long will this go on for? The answer is as long as it needs to and as long as the market believes whatever it currently believes.

Or technically one could run a Fibonacci Trace on it to see where potential targets are , but nothing is set in stone until a Lower Low or Higher High is made again so it will just go side ways up and down in a range.

Usually you will see some uncertainty and a consolidation phase set in until both overall market sentiment switch or more super fantastic outstanding results convince the market accordingly.

So there you have it, thats about it from me folks and good luck :)

ps:
I dont hold.
I have also added another Zoomed view of the price candles at close whereby the price it sitting right on the 60ema line which may o rmay not act as support. Yet as always, time will tell.

[macduffy]

It seems the market liked what the Chairman and the CEO had to say at today's AGM.

CPB up 4% to $46.61.

I continue to hold.

[macduffy]

It seems the market liked what the Chairman and the CEO had to say at today's AGM.

CPB up 4% to $46.61.

I continue to hold.

Make that 5% to $47.07.

One of my better investments of recent years!

[macduffy]

CPB continues on the acquisition trail.

http://asx.com.au/asxpdf/20111101/pdf/4227vhcpvtdk80.pdf

No, not XRF. Wonder if that's next on the list?

[macduffy]

Comment on CPB's record half year result - and a few other topics!

http://www.smh.com.au/business/campbell-brothers-humming-along-in-top-gear-20111129-1o555.html

Am I the only one interested in this success story?

[drillfix]

Reading the rest of this thread Macduff, it appears that you are!

Of course with the exception of me reading what you write and checking out a chart of the stocks performance.

CPB continues trending upward with all the EMA's lined up with price still aboe the 13ema.

A slight technical concern is that the stock is now also trading in Range Bound and failure to break above $49.72 could see the stock retest the lower EMA's

I guess those who grabbed parcels below $40.00 are quite happy with their recent move, however the longer this stock remains in this range without breaking upward, it causes me to believe it can break to test the downside.

After all, what does not go up, will come down, and vice versa, but previous tests have been to the upside and stalled.

Good luck MacDuff :)

[macduffy]

Thanks for your comments, drilly, much appreciated!

I've been conscious of CPB's range-bound state for a while now, despite its stellar performance profit-wise. I've put this down to the state of the market generally - although CPB has probably done rather better than the market as a whole this year? - and the rapid expansion of the business through takeovers. Nevertheless, interim dividend has been increased to 95cps, from 65c last year, I think, so profitability increases havn't come solely from takeovers.

The SP has come a long way since I bought in at a depressed price a few years ago but I won't be slow to take my profits if this range starts to break to the downside.

[drillfix]

No worries macduff, and yep, I agree that CPB has done well contrary to the rest of the market, that is a positive.

Also as is the rise in divi as you pointed out, a double bonus.

Anything that does not fall over the last year but maintains and pays a divi certainly will be a better performer than the market.

Good to see you being steadfast about the trading range also :)

[macduffy]

CPB has been voted the "Fund managers' favourite".

I'd better be ready to sell mine!

http://www.smh.com.au/business/campbell-is-the-fund-managers-favourite-20111225-1p9i3.html

[macduffy]

CPB broke through the $60 mark for the first time today making it a four bagger since I bought at around $12.

Yes, I know I'm feeling smug and that pride invariably comes before a fall!

:t_up:

[soulman]

No such thing McDuff. You are on your way to a century.

[macduffy]

No such thing McDuff. You are on your way to a century.

Thanks for the encouragement, soulman.

:)

Slowly grinding out that century - now consolidating above the $62 mark!

Cheers

[drillfix]

Hey Macduff,

If one looks at the trading / order depth volumes of this stock it would almost come across that of BOTs however at $62.66 a share then I guess it is understandable.

Good on ya for holding the forte from quite a while back and sticking with what appears to be a great chart though not sure how long it can continue upward for without needing to take a breather.

[macduffy]

Yes, all stocks take a breather now and again and CPB's not an exception. I sold about 25% of my holding at around $40 some time ago and would be prepared to drop some more if a downtrend became established. Or at least I hope I would!

In today's news just received, CPB is buying a UK testing business for AUD39m - a relatively small acquisition for them.

http://asx.com.au/asxpdf/20120319/pdf/4253jzjvjs2fmf.pdf

[macduffy]

And through the $64 mark today!

Don't know how long this will last but I'm hanging in there for the present.

:cool:

[drillfix]

Amazing there Macduff.

Great chart although it is starting to become a bit sporadic and even possibly Painted.

Also, some funny business which by looking at the Order Book you can see there are trades with 0 being counted as trades.

Also there was a volume of 294,649 shares traded over 7,685 trades which seems slightly odd dont ya think.

Not that it matters much but good to see your still got your parachute ready and both fingers on the pulse, well done :)

[Packersoldkidney]

Great company - a blue chipper with the deepest shade of navy - nice work Macduffy. Market still thinks there is more growth ahead for it and hard to see why not given the mining services cycle is yet to reach a peak.

[macduffy]

And through $66 today!

It's getting lonely at the top!

:t_up:

[drillfix]

As always, way ta go Macduff. No better feeling than sitting on a winner with stacks of headroom hey~!

Not that your a chart man, but one for the record hey.

Here is an EOD intraday of CPB > http://www.imageurlhost.com/images/45x1ttq01selzeau8kly_CPB.png

On the lower indicators, notice that there room for OBV to move higher on the OBV and even RSI a slight tad, as too MFI and also DMI has more room to spread.

The 60 min chart is rock solid with a few breathers which can be expected.

Last if you were thinking about an exit then I would definately keep an eye on OBV to the upper line or previous highs and wait for a decline to start, this IMO would signal a significant breather if needed or warranted, or also keep an eye for divergence in the RSI this may also signal a pre Warning.

Good stuff there macduff, and (again IMO) should there be any breathers then one would obviously say it would be to the 13 ema line (light blue) located at $63.00 but in the meantime, Enjoy the up move :)

[macduffy]

Many thanks for the TA, drilly.

I don't expect to ever sell at the top but it certainly helps to know what to look out for!

Cheers

[macduffy]

CPB broke through the $69 barrier today. Nice, steady rise continues!

:)

[soulman]

Definitely a slowdown in the mining sector. CPB has dropped like stone in the last 2 months.

Have you exited McDuff. I see more falls into the $30's.

[macduffy]

I sold half my holding around $61 - after the big fall! - but hung on to the rest. Still like the stock and may buy a few back when/if the SP finds a floor. At $47 they're now trading on a more reasonable historical P/E of 14.28 with profit guidance of 27% - 37% increase in first half NPAT. Most companies would be more than happy with that but I take soulman's point that the mining sector has its problems at present.

[soulman]

Definitely the low tone on future profits hurt the shares McDuff. The mining sector is being hurt by the miners by them demanding higher wages and in turn making it more expensive and non-feasible to operate a low NPV mine.

[macduffy]

Name has changed to ALS Limited - derived from Australian Laboratory Testing Services.

New code is ALQ.

Now how do I change the name of the thread? Or will administation do that?

:confused:

[Fred114]

Around 10% wiped off its value today due to reported lower commodity prices.

[macduffy]

Around 10% wiped off its value today due to reported lower commodity prices.

I don't think so. Down about 4.2% today as far as I can tell - but the SP has certainly been more volatile than most since the "mineral boom is over" mood took hold. A similar negative period several years ago provided a buying opportunity as low as $12 - equivalent to $2.40 before the recent 5 for 1 split!

(I'd change the name of the thread if I knew how.)

:mellow:

[Fred114]

Sorry that comment was intended for Iluka (ILU), another mining stock which was well down today....

ALQ looks a very good stock to hold, but exposed to mineral boom. Are they good buying around this price do you think?

[macduffy]

ALQ has grown substantially over the last few years, largely by acquisition of firms in related, but usually different forms of analysis than ALQ's. 49% of revenue is still earned by the Minerals division although non-minerals' revenue is now larger than the company's total revenue of 2 years ago! All this is reflected in a total return to shareholders of 600% in the last three year period!, according to the company's presentation to a Brisbane conference yesterday.

http://www.asx.com.au/asxpdf/20121011/pdf/4299ncq93r4dhr.pdf

I'm a holder and may look to add a few more - but will probably wait for the SP to settle first.

[Fred114]

Seemed to be a massive 7% drop today on the release of financial data showing a record profit......why is the market abandoning this stock?

Disc: hold....

[macduffy]

Seemed to be a massive 7% drop today on the release of financial data showing a record profit......why is the market abandoning this stock?

Disc: hold....

Good question!

The market has come to expect a lot of ALQ and profit expectations of a 5 -15% increase in NPAT for the full year are apparently not enough! The company has a good track record in meeting and exceeding profit forecasts but given the uncertainty around the mining sector at present perhaps it's understandable that there is some caution now.

I hold - and still looking to add a few more when/if the SP gets too "attractive" to resist.

[macduffy]

ALQ continuing to rise from the lows of November - trading at $11.49 today.

I never did get to add a few more, but not complaining too much!

:mellow:

[Fred114]

Some trades have been up over $12, but it has not yet firmed at this price. Wondering where the top is....this run has been excellent for me too......:)

[macduffy]

Still has a bit to go to reach its all-time high of around $13.80 - $69 before the share split.

My TA "skills" don't extend to interpreting whether or not that's relevant but I do believe in letting profits run!

[steve fleming]

UBS sees quickening decline in resources industry

PUBLISHED: 4 hours 41 MINUTES AGO | UPDATE: 2 hours 45 MINUTES AGO PRINT EDITION: 28 May 2013 Edited by Sarah Thompson, Anthony Macdonald and Gretchen Friemann

UBS has warned the deterioration in the minerals industry is occurring faster than anticipated and warned the weakness will persist throughout next year.

The bank re-iterated its sell rating on ALS Limited (ALQ), a leading provider in minerals, and stressed its bearish view on the stock stemmed from the poor outlook for the sector rather than the company’s balance sheet or its market positioning, which remains “attractive”.

Analysts Sam Theodore and Rohan Sundram argued the downturn in the industry would hit about 60 per cent of ALQ’s earnings before interest and taxes.

The banks expects the company’s earnings per share to decline by close to 13 per cent in FY14.

The bank noted that the deterioration in minerals will be partially offset by the company’s strong growth in life sciences which has been boosted by recent acquisitions.

[winner69]

Share prices follow earnings....buy EPS growth!!

Suppose that means sell eps decline as well?

[steve fleming]

Share prices follow earnings....buy EPS growth!!

Suppose that means sell eps decline as well?

UBS seems to think so....for what its worth

[winner69]

Just that tag line you use is very good

[Huang Chung]

Was happy to buy these under $9 a week or so ago.

UBS rating seems a little pessimistic, given that the share price has already come back a long way in anticipation of their resources exposure causing a drag on earnings.

[Huang Chung]

KW, your competition pick is looking pretty sweet today....

[Huang Chung]

Took profits today, averaging an exit at $1.245.

A great company, but the run over the past couple of days makes me think there could be a bit of a reversal.

So....what to buy next?

[macduffy]

Yesterday's profit announcement was in line with guidance but the SP managed an 8% jump nevertheless! Probably in relief that the mining downturn hasn't seemed to hit the company any harder than management expected. And up another 10% today!

I still hold a few

[Joshuatree]

For what its worth Shaw stockbroking have a sell with a price target $6.60

[macduffy]

Meanwhile - up another 3.4% today.

:cool:

[noodles]

Yesterdays profit update was poor. They are forecasting $74mill for 1H15. If we annualised this to estimate for FY15, we get $148mill (or 37.5cps). At yesterdays price of $7.40, this leaves ALQ on a pe of 20. Way too high for me.
I placed a small short trade at 7.87 yesterday. My target is $5
I would have been a lot more aggressive, but I noted the following:
1. $7-$7.50 is a strong support zone for the stock.
2. Given the previous price action, it appears that the market was expecting it.

Are there any bulls out there with an alternative view? macduffy?

[macduffy]

No, the outlook for the mining sector is against ALQ at present. The company has a history of bouncing back strongly in the good times though so I'll wait for sentiment to change before building again. Meanwhile, holding a small parcel to keep interested!

[soulman]

Yesterdays profit update was poor. They are forecasting $74mill for 1H15. If we annualised this to estimate for FY15, we get $148mill (or 37.5cps). At yesterdays price of $7.40, this leaves ALQ on a pe of 20. Way too high for me.
I placed a small short trade at 7.87 yesterday. My target is $5
I would have been a lot more aggressive, but I noted the following:
1. $7-$7.50 is a strong support zone for the stock.
2. Given the previous price action, it appears that the market was expecting it.

Are there any bulls out there with an alternative view? macduffy?

Hey Noodles, which provider do you short with?

[noodles]

Hey Noodles, which provider do you short with?
IG markets

[noodles]

Yesterdays profit update was poor. They are forecasting $74mill for 1H15. If we annualised this to estimate for FY15, we get $148mill (or 37.5cps). At yesterdays price of $7.40, this leaves ALQ on a pe of 20. Way too high for me.
I placed a small short trade at 7.87 yesterday. My target is $5
I would have been a lot more aggressive, but I noted the following:
1. $7-$7.50 is a strong support zone for the stock.
2. Given the previous price action, it appears that the market was expecting it.

Are there any bulls out there with an alternative view? macduffy?

A 17% drop on a profit downgrade today. Still short and nearly at my target of $5. But should I drop my target as a result of the earnings downgrade?
First half profit is now forecast to be $64mill. Double that to get a full year of $128mill. That still leaves it on a pe=18. Not cheap at all.

[noodles]

ALQ broke through support of $5 today.

Brokers a forecasting a full year result of $137mill leaving it on a forecast pe of 14.7 at today's close price. This must be one of the highest pe ratio's in the mining services sector.

The half year results are coming up on 24th Nov. Perhaps the market is expecting a weaker result than forecast ($64mil) or a poor outlook. Given the recent track record of disappointment, it would not be a surprise.

My short is still open. I'll tighten my stop prior to the half year result.

[macduffy]

I hope you've closed out your short, noodles. The SP's taken a battering lately but is up 16.6% today on beating half year profit guidance.

http://www.asx.com.au/asxpdf/20141124/pdf/42tyc83vxj5qm0.pdf

[noodles]

I hope you've closed out your short, noodles. The SP's taken a battering lately but is up 16.6% today on beating half year profit guidance.

http://www.asx.com.au/asxpdf/20141124/pdf/42tyc83vxj5qm0.pdf

I'm out. What a brutal days for shorters. The heart bleeds:)

I actually tried to buy some stock during the auction, but it gaped too much for me.

Long suffering longs will be pleased that they actually beat forecast. 4th quarter sounds awkward, so not out of the woods yet. Certainly won't be looking to short or long on this stock for a while yet.

[soulman]

I'm out. What a brutal days for shorters. The heart bleeds:)

I actually tried to buy some stock during the auction, but it gaped too much for me.

Long suffering longs will be pleased that they actually beat forecast. 4th quarter sounds awkward, so not out of the woods yet. Certainly won't be looking to short or long on this stock for a while yet.

Back down again today.

Hey noodles, who do you short with ? and do you need to be a high net worth sophisticated investor ?

[noodles]

Back down again today.

Hey noodles, who do you short with ? and do you need to be a high net worth sophisticated investor ?
-provider is ig.com
-I remember having to do a test when signing up for CMC when in the UK. They wanted to ensure I knew the risks. However, nothing for IG when signing up from NZ. They don't care if you are high net worth or not.

Be careful. CFD's are highly leveraged.

[macduffy]

Quite a while since any interest was shown in ALQ as it battles the mining blues, along with its major customers. Along comes private equity "saviour" with a bid at $5.30, quickly rejected by the company as "opportunistic".

http://www.asx.com.au/prices/market-news-detail.htm?an=DJDN000020160602ec62000up

[Joshuatree]

Thanks mac; maybe another indicator that the bottom is in for M/S companies.? Still holding BYL and BOL and HDX which i was far too early in unfort. May look at a new thread re the better M/S companies to look at if i can fit it in.

[Joshuatree]

Thanks mac; maybe another indicator that the bottom is in for M/S companies.?

M/S stocks have had a great run since generally.Been running hot!

[DarkHorse]

Indeed. Any thoughts on SXE? (WAM keen holders)

[Joshuatree]

Noted SXE down yest $45 mill cash and$83-89 mill mkt cap no debt? Profit and margins up Revenue down a lot. Lumpy 2nd half drop off. Is this why mkt pushed s/p down? From 60c to 52c.
Two thirds of rev came in first half and NPAT $3.8 mill, $5.4 mill NPAT full year (last year $4.2 mill), s/p low 30's then). As far as I've got. Bought TPP yest and its up today with SRG, on a down day so heres hoping.

[macduffy]

ALQ's sale of its oil and gas technical services division appears to have been well received by the market - shareprice now over $8!

Company is to concentrate on its lab testing services, which has always been its strength.

I hold.