Market's view on Latham Timber
Published on April 2024
- SP Angel maintains its forecast with a projected EPS of 96p and a turnover of £374m for the year, with a potential dividend of around 28p. There’s mention of increased stock holding due to longer supply chains, impacted by issues in the Red Sea, and market pressure from competitors selling lower-priced products. The company is observed to be well-positioned with strong trade relationships and a solid balance sheet.
- A long-term shareholder highlights the company’s conservative forecasting and focus on long-term management, emphasizing its family business nature, which instills strong company values and experience.
- The market capitalization slightly exceeds the last reported net tangible asset value, suggesting potential for special dividends or buybacks given the strong balance sheet.
- Current trading statement reflects a market depression, yet aligns with the previous year’s high results, indicating stability.
- Discussion at the Blackrock Throgmorton AGM includes a positive outlook on builders and industrials, suggesting a favorable view for companies like Latham with significant cash reserves.
- Observations at the company’s AGM reveal strong cash positions and efficient cash generation, with plans for geographical expansion. There’s cautious optimism about meeting market expectations despite economic uncertainties.
- A trading update at another AGM points to a decrease in sales and average product prices but maintains that overheads and profits align with market expectations, showing effective management amidst variable market conditions.
- Comments on the staff bonus and pension scheme details suggest a benevolent employer which could contribute to long-term employee retention and reduced costs in training and recruitment.
- The company’s financial resilience is highlighted, with significant cash reserves and robust cash generation capabilities, positioning it well to withstand market fluctuations.
- Analysis of the company’s property holdings and management style portrays a conservative, asset-rich company with potential undervaluation of fixed assets.