Ford Equity International Rating and Forecast Report

Ford Equity International Research Reports cover 60 countries with over 30,000 stocks traded on international exchanges. A proprietary quantitative system compares each company to its peers on proven measures of business value, growth characteristics, and investor behavior. Ford's three recommendation ratings buy, hold and sell, represent each stock’s return potential relative to its own country market.. The rating reports which are generated each week, include the fundamental details behind...

Olympic gold

Avesco’s trading update outlines continued strong trading over the summer at Creative Technology in the US and at the Rio Olympics and Paralympics. FY16 results (to end September) will be “comfortably” ahead of previous expectations. Positive momentum continues into FY17, when a good schedule of sporting and commercial events, along with currency benefit, will buoy what would normally have been a weaker, odd-numbered year. With a rising dividend and asset backing, the valuation multiple remains ...

Outlook: Good projections

A good H116 from Creative Technology, particularly in the US, underpins our maintained profit forecast for the full year. Avesco’s FY14 restructuring is clearly delivering on the promise to smooth results between odd and even years, while the recent sale of Fountain Studios has realised cash to pay down debt and increase targeted investment in equipment. With a progressive dividend, a discount to net assets and a very modest multiple, the group is an attractive and coherent investment proposit...

Update: 'Odd' year outruns the best 'even'

FY15 results were ahead of forecasts, with particularly strong performance from Creative Technology (CT) in the US and with CT Europe getting a boost from the European Games in Baku. FY16 should benefit from the UEFA European Championships and Rio Olympics. Growth of corporate revenues and the migration of Presteigne to dry hire only are helping to even out swings between odd and even years, with the ‘odd’ FY15 outperforming previous ‘even’ highs. The Fountain Studio sale will further bo...

Outlook: Excellent momentum

Avesco is a leading audiovisual provider for major events such as Wimbledon and yet its trading profit margins only averaged 3.5% between FY12 and FY14. Higher, more consistent margins (now averaging over 5%) are a key area of upside for the group and today’s excellent interim results and profits upgrade demonstrate the benefits of the recent restructuring on top of strong US trading. The shares continue to represent very good value, trading at a 20% discount to the NAV of 180p and yielding a ...

Update: Restructuring pays dividends

Avesco’s FY14 restructuring is paying off, with the AGM statement signalling a material upgrade to FY15 estimates – we have increased FY15e PBT by £1m or 33%, to £4m. More efficient resource utilisation and loss elimination is minimising the usual ‘odd’ year effect in Europe, while CTUS continues to enjoy buoyant trading conditions. The balance sheet is strong, with a NAV of 167p underpinned by high-quality rental assets. The progressive dividend policy and FY15e yield of 5.4% is very ...

Update: CTUS leading the way

Avesco reported FY14 results slightly ahead of our recently upgraded estimates, with Creative Technology US (CTUS) leading the way with its revenue up by 18% in buoyant markets. Avesco is much more streamlined post its recent restructuring and is achieving an impressive double-digit return on capital (11.9% in FY14). Solid cash flows underpin expectations of progressive dividend payouts despite our expected FY15e ‘odd year’ dip in profits. The share price looks too low given the FY15e yield ...

Institutional Comment: Daily comment

Update: Estimates upgraded

Avesco has released a positive update and reported that FY14 profits will be ahead of market expectations. Trading was strong in Q4, particularly at CTUS, and cost savings from the group restructuring are coming through more strongly and quickly than anticipated. We have increased our normalised PBT by £0.5m for FY14 and see further upside for margin improvement going forward. Solid cash flows comfortably fund a progressive dividend policy and the FY14e yield of 5.7% is very attractive.

Update: Much more streamlined

Avesco's interim results showed trading profit ahead of our expectations and a 50% increase in the dividend. The major reorganisation of the European business is nearly complete and the benefits will flow through in the second half and more particularly in FY15. We have increased our PBT and dividend forecasts and see plenty more upside for margin improvement. The shares now yield a prospective 6.2% and stand at a 61% discount to diluted NAV of 163p/share, with a sound balance sheet backed by hi...