|Bid||484.10 x 168900|
|Ask||484.40 x 76000|
|Day's range||480.20 - 489.00|
|52-week range||410.10 - 846.40|
|Beta (3Y monthly)||1.32|
|PE ratio (TTM)||12.30|
|Earnings date||19 Nov 2018 - 23 Nov 2018|
|Forward dividend & yield||0.30 (6.25%)|
|1y target est||779.00|
Anyone researching Babcock International Group PLC (LON:BAB) might want to consider the historical volatility of the...
(Bloomberg Opinion) -- Serco Group Plc CEO Rupert Soames frequently boasts that the U.K. contracting firm was an early adopter of financial carnage – to stress that the business is now the better for it.Pulling through a crisis five years ago has given Soames the credibility to embark on M&A, and he has had his eye on defense contractor Babcock International Group Plc.Contrast this with construction group Kier Group Plc, which on Monday reminded investors just what financial carnage looks as it unveiled a plan to shrink and cut debt.Government contracting is a potentially attractive business – but when it goes wrong, it can be a disaster. Memories of Carillion Plc’s bankruptcy may still be fresh in investors’ minds. At least Serco shows that these businesses can, eventually, pull through.With the shares at a two-year high, Serco is in the luxurious position of being able to fund deals by selling stock. It has come a long way since 2014’s emergency rights offering. A takeover of Babcock – which has a market value of about 2.5 billion pounds ($3.2 billion) against Serco’s 1.7 billion pounds – would be ambitious and involve issuing stock to Babcock shareholders.The move looks opportunistic: The target’s shares have halved in the last two years, its management is out of favor, and a recent investor day prompted a lukewarm response.The combination would seem to offer more to Serco than to Babcock – unless there were a significant premium to compensate, and the relative size of the businesses would make such a thing hard to engineer.Serco hasn’t been fully rehabilitated; its dividend remains suspended. Babcock, which does pay a dividend, has niche businesses in aerospace and defense with better-than-average margins. Much as its shareholders may admire Soames, a deal would surely dilute the quality of the Babcock business. It’s not hard to see why the target rejected talks following an approach earlier this year.Kier, 10%-owned by beleaguered investor Neil Woodford, is finally doing the same things as Serco did during its crisis – selling assets, changing management and raising equity – albeit in the wrong order. December's 250 million-pound rescue rights offering has already been exhausted and the company is only now just embarking on a radical self-help program. Its market value today is just 178 million pounds.It’s now clear there is much that Kier could have done by way of restructuring before asking shareholders to stump up last year. New CEO Andrew Davies is jettisoning businesses, such is its residential property construction arm, that drain working capital and have few synergies with the core contracting operation, which is focused on infrastructure and highways. The dividend is going altogether, as are 1,200 jobs, largely from corporate center.Kier points to the absence of near-term debt maturities, which should give it some breathing space. But the company appears to be a forced seller and will need to attract competing bids to inject some tension into the sale process.This is an uncomfortable position to be in given the uncertainty around Brexit. The financial strains are now dictating strategy after an aggressive program of expansion by acquisition left the company short of cash.It is possible Kier will pull through, its share price will pick up and that one day Davies, like Soames, will be able to look back and joke about financial carnage. For investors right now, that moment seems an incredibly long way off. As for Serco, its acquisition currency may not yet be tempting enough, and its target’s woes not painful enough, to make a deal with Babcock a reality.To contact the author of this story: Chris Hughes at email@example.comTo contact the editor responsible for this story: Edward Evans at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Chris Hughes is a Bloomberg Opinion columnist covering deals. He previously worked for Reuters Breakingviews, as well as the Financial Times and the Independent newspaper.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Kier Group will sell its housebuilding and property businesses, cut about 1,200 jobs and suspend its dividend for at least two years in a radical overhaul designed to lower debt and stabilise the business. Shares in Kier, which has contracts for London's Crossrail project, fell 13% to a new low of 114 pence after the strategic review was rushed out on Monday by Chief Executive Andrew Davies, who took charge in April. Kier is the latest company to run into trouble in the British outsourcing sector, which provides essential services to central government, local authorities and other public bodies.
Babcock said that on 23 January it received an unsolicited and preliminary proposal from Serco regarding a potential all-share deal. "A combination of the two companies had no strategic merit and was not in the best interests of Babcock's shareholders, customers or wider stakeholders," the company said in a statement. Contractors such as Babcock, whose biggest customer is Britain's Defence Ministry, have been hit by a slowdown in decision-making because ahead of Brexit.
British outsourcer Serco has made two attempts to merge with its bigger rival Babcock in a deal focused on the defence industry which would have created a company worth 4 billion pounds ($5 billion), The Sunday Times reported. Serco made a preliminary approach late last year, according to the newspaper. Serco's Chairman Roy Gardner contacted his counterpart at Babcock, Mike Turner, who rejected the offer, the report said.
Neil Woodford has sold 97 million pounds ($123 million) of shares over the past 10 days to boost liquidity in his suspended equity income fund, a Woodford spokesman said on Thursday. Market participants have been expecting a wave of forced selling by Woodford, with some hedge funds taking out short positions against his investments. "Since suspension, Woodford has sold 97.1 million pounds of stock as he continues to reposition the Woodford Equity Income Fund portfolio," a Woodford spokesman said by email.
British money manager Neil Woodford cut his stakes in at least 21 companies this week as he frees up cash to meet a rush of redemption requests that forced him to suspend his flagship fund. Woodford, one of Britain's best known investors, froze his Equity Income Fund on Monday as too many people were asking for their money back after a number of his top investments turned sour. Filings from the London Stock Exchange - more than 80% of his holdings are UK-based - found 21 sales by Woodford of companies in which he is a major investor.
While small-cap stocks, such as Babcock International Group PLC (LON:BAB) with its market cap of UK£2.2b, are popular...
The main index, whose companies earn more than two-thirds of their profit from abroad, ended 0.1% higher, while the more domestically-focused FTSE 250 slipped 0.7%. A slump in sterling lifted internationally-exposed companies GlaxoSmithKline, Unilever and AstraZeneca, the biggest boosts to the FTSE 100. Stocks most sensitive to the any increased risk of a hard Brexit stumbled after multiple media reported rumours May's ministers could oust her in a row over her latest deal to exit the European Union.
British engineering services group Babcock said on Wednesday it expected revenue and underlying operating profit to fall in 2019/2020 as it reshapes its business in response to a tough domestic market. Babcock shares tumbled more than 9 percent by 0825 GMT, touching their lowest levels so far this year and taking the decline over the past year to almost 40 percent. Government contractors have been hit by a slowdown in decision-making because of Britain's impending exit from the European Union, which has forced a strategy rethink by Babcock whose structure has become increasingly complex.
Mid-caps stocks, like Babcock International Group PLC (LON:BAB) with a market capitalization of UK£2.6b, aren’t the...
One of Britain's most senior industrialists will this week take on his first boardroom role since becoming the latest victim of a corporate governance crackdown on long-serving chairmen. Sky News has learnt that Mike Turner will be named as the senior independent director of Gulf Marine Services (GMS), a London-listed operator of support vessels serving the deepwater oil and gas industry. Mr Turner's appointment will add decades of industrial experience to a company which has been hit by a two-thirds slump in its value during the last 12 months.
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Building up an investment case requires looking at a stock holistically. Today I've chosen to put the spotlight on Babcock International Group PLC (LON:BAB) due to its excellent fundamentals in more than one area. BAB...
Babcock, a key supplier to Britain's ministry of defence, said on Wednesday Cairnie will assume the role on Turner's retirement at the annual general meeting on July 18. Turner's resignation in January came amid a decline in Babcock's share price and company warnings that income from nuclear decommissioning would fall sharply.
Britain's Babcock International Group said Rolls-Royce executive Ruth Cairnie would take over from outgoing chairman Mike Turner, becoming the first woman to hold the role at the engineering and defence services provider. Babcock, a key supplier to Britain's ministry of defence, said on Wednesday Cairnie will assume the role on Turner's retirement at the annual general meeting on July 18.
Want to participate in a research study? Help shape the future of investing tools and earn a $60 gift card! Over the past 10 years Babcock International Group PLC (LON:BAB) has been paying dividends to shareholders...
The FTSE 100 ended 0.5 percent higher after rallying as much as 1 percent with gains capped due to investors shunning defensive stocks, and the midcaps added 0.6 percent. UK markets joined a global rally sparked by data showing Chinese factory activity grew for the first time in four months in March, as well as hopes of a resolution to a prolonged trade dispute between Washington and Beijing. Also driving sentiment was a survey that showed UK manufacturing growth at an unexpected 13-month high last month as the country stockpiles for Brexit.
Babcock International Group, the company which maintains the UK's fleet of nuclear submarines, is lining up a director of Rolls-Royce to become its next chairman in a landmark appointment for British industry. Sky News has learnt that Babcock has identified Ruth Cairnie, a former Royal Dutch Shell executive, as the preferred candidate to replace Mike Turner. An announcement about the successor to Mr Turner, one of the leading figures in British industry over the last two decades, could be made as soon as next week.
We often see insiders buying up shares in companies that perform well over the long term. On the other hand, we'd be remiss not to mention that insider sales haveRead More...
The FTSE 100 ended 0.5 percent lower after steep losses in the morning as the index's stocks, which book much of their earnings in dollars, were marred by the pound surging to four-month highs. The midcaps added 0.1 percent as a 10 percent surge in Travis Perkins on better-than-expected full-year adjusted earnings helped cushion a slump in Metro Bank triggered by a cash call. The pound gained on reports that British Prime Minister Theresa May would rule out a no-deal Brexit and delay the March 29 deadline for exit from the European Union.