This report is not a personal recommendation and does not take into account your personal circumstances or appetite for risk.
Trade Parameters
Technical Observations – For
Technical Observations – Against
Pros: Bullish breakout by shares from consolidation range after near 20% decline from may highs. UK construction output statistics suggest rising growth (+3.5% YoY in July, up from negative in April). UK focus should mean insulated from Brexit. Attractive 7-7.5% forward dividend yield. Unscathed from sector woes that saw collapse of Carillion.
Risks to Kier include both a downturn in the UK construction sector and Brexit uncertainty. The company is mostly UK, but does have operations in the Americas, and both the Middle and Far East so further equity market weakness (global trade war?) could see risk assets (those sensitive to growth) shunned. Rising interest rates make projects costs more expensive. Lastly, Broker downgrades.
Brokers/analysts are very bullish on the shares with 78% saying Buy and only 11% suggesting Sell. Note also 89% suggesting upside to a consensus target of 1398p, well above our short-term target of May highs.
Next Event: Preliminary FY results, 20 Sept; Ex-div (45p/4.5%?), 27 Sept
Latest Broker 12-Month Consensus: 78% Buy, 11% Hold, 11% Sell (full breakdown on request)
Source: DowJones Newswires, Reuters News, Bloomberg or Company Press releases
| 1wk | 1m | 3m | 6m | 1yr | 2yr | 3yr | 4yr | 5yr | |
| Perf % | 11.3 | 9.9 | -1.0 | -5.9 | -11.9 | -18.3 | -33.7 | -25.4 | -24.2 |
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Prepared by Michael van Dulken, Head of Research