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NWH - NRW HOLDINGS LIMITED


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Avoid The Torpedoes! By Rudi Filapek-Vandyck, Editor FNArena

 

This year, amidst downward pressures in the US and continued severe downgrades elsewhere including in Asia and in Australia, general confidence has risen that the world economy will be in a better state in the second half of 2013 and in subsequent years. This has, again, led investors to take a leap of faith and ignore what immediately lies in front of them. Profit prospects for FY14 are thus the new gospel for those investors looking to jump on board the sentiment driven train.

 

However, this year's prospects cannot be completely ignored in the meantime, as there's still plenty of room for bad news announcements; especially for companies in sectors facing downward pressures and headwinds.

 

In the share market, NRW Holdings (NWH) is yet another example. Surely most investors would have thought that after the caning the share price received since May this year, which saw the share price more than halve over the period (from above $4 to less than $2) would prove more than sufficient to account for the quick reversal in revenues and profits at the mining services provider, but there was yet another profit warning and sell-off to come. As I write today's story, the share price is close to $1.30 but still falling in an otherwise up-trending market.

 

On present consensus forecasts, NWH shares are now offering in excess of 12% in prospective dividends (fully franked) while trading on the super-low Price-Earnings (PE) ratio of four times the current year's earnings per share (EPS), suggesting investors are now taking an extremely negative view. But then it's difficult to confidently play the role of value investor when price action on charts continues to show weakness and management is still forced to issue profit warnings.

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I would like to hope that NWH will not go any lower. In the past few days the SP has risen slightly. What do other holders think? I would also like to ask ARTY about his chart and comments, which are always so valuable. Sorry Arty, I know you must be exhausted with all the requests, but I know that you are a very nice and kind person. Skip a chart for AGO and go to NWH, pls.

AGO has its fill of your attention - those guys on AGO thread are truly funny.

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In October, I mentioned the absence of Accumulation indicators and suggested a drop towards $2.

Well, drop it did - much lower than I'd imagined at the time!

Recently, however, those Accus made an appearance, suggesting Daggie could get her wish and it's found support around here.

(who said flattery gets you nowhere ;) )

 

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For me to be tempted, $1.34 would have to be broken and proven support. If it came to pass, $1.24 would become the initial stop; a first target of $1.64 would constitute a 3:1 reward to risk - possibly increasing to 5:1 if the overhead gap were to be closed.

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Some very positive info about NWH atm and current recommendations:

 

 

http://www.eurekareport.com.au/broker-alerts/1951 :

 

 

 

UBS rates NWH as Buy

 

NRW Holdings remains a key pick in the small cap mining services sector for the broker despite the slump in the share price since February. The broker considers all negatives are well priced in and the market is failing to recognise the quality of the business model. The price target is steady at $3.35 and the Buy rating is retained.

 

Target price is $3.35 Current Price is $1.42 Difference:$1.93 - (brackets indicate current price is over target). If NWH meets the UBS target it will return approximately 136% (excluding dividends, fees and charges - negative figures indicate an expected loss).

 

The company's fiscal year ends in June.

 

UBS forecasts a full year FY13 dividend of 18.00 cents and EPS of 30.00 cents . At the last closing share price the estimated dividend yield is 12.68%.

 

At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 4.73.

 

 

 

 

 

http://www.afr.com/p/markets/market_wrap/n...n9wTtKyxBIHAzxH :

 

 

 

Broker Watch

 

 

NRW Holdings (NWH)

PUBLISHED: 08 Apr 2013 11:04:53 | UPDATED: 09 Apr 2013 15:50:05

 

Marianna Papadakis

 

Morningstar has lifted its recommendation for contract civil and mining services company NRW Holdings from "hold" to "accumulate".

 

The company is leveraged to the West Australian iron ore market, but is expanding into oil and gas in that state as well as into Queensland coal.

 

The research house said it had significant revenue from mining giants BHP Billiton, Rio Tinto and Fortescue Metals Group and was in a good position to renew contracts and win ones.

 

Because the company is leveraged to the resources cycle it is subject to swings in profitability, meaning its earnings will be affected by the downturn in commodity prices and volumes, Morningstar said. "Margins also suffer in competitive tendering and a rising cost environment."

 

Morningstar has a target price of $1.80. Earnings per share were 35ÃÆâ€â„¢ÃƒÆ’ƒÂ¢Ãƒ¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡ÃƒÆ’â€Å¡Ãƒƒâہ¡ÃƒÆ’‚¢ in 2012 and Morningstar estimates EPS of 31ÃÆâ€â„¢ÃƒÆ’ƒÂ¢Ãƒ¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡ÃƒÆ’â€Å¡Ãƒƒâہ¡ÃƒÆ’‚¢ in 2013 and 30ÃÆâ€â„¢ÃƒÆ’ƒÂ¢Ãƒ¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡ÃƒÆ’â€Å¡Ãƒƒâہ¡ÃƒÆ’‚¢ in 2014.

 

 

 

http://www.afr.com/p/markets/market_wrap/n...DNe3XkWGohwXiOO

 

 

 

 

 

NRW Holdings moves from strength to strength

PUBLISHED: 08 Apr 2013 16:20:01 | UPDATED: 08 Apr 2013 16:23:32PRINT EDITION: 08 Apr 2013

 

Trevor Hoey

 

Analysts at Morningstar on Monday upgraded NRW Holdings from "hold" to "accumulate", highlighting that as well as its strong civil and mining services business, its expansion into Queensland coal and Western Australian oil and gas markets augured well for the future.

 

Another positive sign was the emergence of Goldman Sachs on the company's share register. Its stake of 5.1 per cent was made public at the end of March, and these shares were accumulated at prices between about $1.60 and $2.

 

While this may not seem such an astute investment based on NRW's recent trading range, it could be argued that the company's shares have been substantially oversold, trading on a price-earnings multiple of about 5.

 

NRW's performance over the past five years, which includes the global financial crisis, has been outstanding. Its average annual return on equity of 36 per cent underlines the company's ability to weather challenging conditions and efficiently grow the business.

 

While growth is slowing, the company's net profit of $48.6 million in the first half of 2012-13 was ahead of broker expectations. Full-year revenue is expected to be about $1.45 billion. Management has guided to a net profit of $87 million, representing earnings per share of about 31ÃÆâ€â„¢ÃƒÆ’ƒÂ¢Ãƒ¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡ÃƒÆ’â€Å¡Ãƒƒâہ¡ÃƒÆ’‚¢, which is in line with consensus forecasts.

 

Analysts at Macquarie have an "outperform" recommendation on the stock with a 12-month price target of $2.85. Based on dividend forecasts for 2012-13 and 2013-14 its current share price implies a yield of about 10 per cent.

 

It is one of the few stocks in the sector where earnings per share forecasts have recently been increased.

 

 

 

 

 

All sounds pretty good for NWH at the moment. One other thing that caught my attention was this reports findings:

 

http://www.afrsmartinvestor.com/p/blogs/ne...FtYTDga83BnQ5GL

 

NWH was the only company in the report that achieved a perfect score based on the crieria...Attached is the image and above is the link of the findings...

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