Herige: The quiet recovery
Herige has disappointed investors enormously. A small trader of building materials in western France, the family company enjoyed a moment of glory on the stock markets in the mid-2000s, when it pursued an aggressive external growth strategy. Unfortunately, when construction markets in France fell as a result of the financial crisis, the group - which was high in debt and poorly structured - saw its sales collapse. A painful but above all long restructuring process followed. Between 2012 and 2018, Herige closed and sold nearly a third of its sales offices and accumulated the associated setbacks. The company recorded losses in 2012, also in 2015 and again in 2018. Needless to say, the group's share price fell each time and the company lost credit on the markets. As a logical consequence, despite a 30% rebound in its share price since the beginning of the year, Herige is now trading at a sharp discount. However, we believe that this discount won’t last very long.
VM Materiaux is engaged in the building market with 3 complementary fields of activity. Co.'s operations can be divided into three segments: Building material trading (Co. has a trading network specialized in distribution of materials for the building and public works sector), Concrete industry (Co. produces pre-cast and ready-mix concrete) and Industrial joinery (Co. manufactures a range of PVC, aluminium or wooden external joinery (doors and windows), as well as entry closures (shutters, fences and gates)). Co. operates only in France. Among its clients, Co. has both professionals in the building industry and DIY customers.
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