Brokers Hargreave Hale gave the following Valuation for HMY

VALUATION
The nearest comparisons to this Group are Sondex, trading on a current year multiple of 14 and Weir Group which typically trades on multiples of 12 plus. We would argue that Hamworthys prospects are brighter than both these companies in view of the strong order book and the global positioning. Fully taxed earnings of 13p this year and 16.5 p for the 2005/6 end March, suggests a current year PE of 9.9x and a prospective PE of 7.8x. There is a prospective yield in excess of 4%. If trading on a similar PER to Sondex the shares would be valued at in excess of 180p. We would argue that a premium to Sondex is justifiable, in particular because of the potential ramp up to sales as a result of the new product pipeline now gaining client acceptance in what is in any event one of the fastest growing markets in the world.

"Shares" Article relating to Hamworthy (HMY) posted below for info.

With a following wind these shares should double over the next year or so.

Some catty folk in the City say the flotation last month by Collins Stewart
could have been handled better, i.e. at a higher price. It was certainly over
subscribed but the rating is half that of similar oil sector service companies
including Sondex.

I hope so! I took profits on NLR to buy into this one as I think all the herd are moving on from NLR at the moment. I hope to buy back later but HMY looks a good bet. fingers crossed! I have spent this evening adding my losses over the past few years---seriously upsetting, I have a lot to make up! I still I'll start a biggest loser competition!! bet it would be a well used thread.
Come on HMY!! hope you feel better soon GF

Think your on a solid one MP.

cheers GF.

Tipped in the I. C. today.

Good stuff all be it 2 months late.

cheers GF.

INVESTORS CHRONICLE

Tips:
*Buy British Airways (BAY.L) at 203p - Pendragon (PDG.L) at 278p - Hamworthy (HMY.L) at 163p - Albemarle & Bond (ABM.L) at 110p - Fountains (FNT.L) at 140p.

cheers GF.

Heres the piece from the IC BUY......................

29 October 2004

HAMWORTHY (HMY)

163p - Aim - As a profitable, well-established company with a strong product range and impressive levels of demand, Hamworthy was somewhat of an anomaly when it joined Aim earlier this year. Hefty demand from institutions offered a clue to its high standing within the investment community, and the impressive rise in its share price to its current high suggests that this support was well-placed.

Hamworthy designs and manufactures innovative marine and offshore fluid-handling systems, focused on gas-handling, pumping and wastewater management. It joined Aim to move into the next stage of its development and to capitalise on market opportunities. It will now concentrate on both organic and acquisitive growth, as it looks to consolidate a fragmented industry.

And there should be plenty of opportunities for growth, given Hamworthy's strong product range. Its customers are international shipyards, ship owners, and oil and gas companies. Their need for leading technology, and the impact of increasing environmental and safety regulation, leaves Hamworthy well-placed to build on its strong foundations - dating back to 1911.

The company's emphasis is now on developing a pipeline of products to drive growth beyond 2007. To date, this is an area in which Hamworthy has excelled - it can boast 16 per cent average year-on-year annual sales growth in the past three years. During this period, sales have jumped from 64.4m to 92.9m, while profits reached 5.8m, compared with 4m in 2002. And a 98m forward order book provides good levels of visibility, which bodes well for the future.

Hamworthy is split into three divisions - pump systems, gas systems and wastewater management. Of these, the main revenue generator is gas systems, which contributed sales of 39.4m in the year ended 31 March 2004.

Its liquid petroleum gas (LPG) reliquefaction system minimises cargo loss and reduces emissions, and led this market in 2003. But because it has such a strong foothold in the market here, there is only limited scope for LPG growth. Its liquid natural gas (LNG) reliquefaction systems enable ships to be powered by more efficient and lower-cost slow-speed diesel engines, although the potential for real growth here is a few years down the line. In the nearer term, its VOC recovery systems, which reliquify hydrocarbon gas emissions from crude oil for storage, provide the most growth potential.

Pump systems accounted for around 36.5m of sales last year. The main products here are deepwell pumps, pump-room systems and engine-room systems. They're supplied to LPG carriers, product and chemical tankers, and crude oil tankers. Its deepwell pumps will dominate growth here.

Finally, the wastewater management system achieved sales of 13.5m last year. The focus is on advanced, environmentally-friendly solutions for the treatment and separation of liquid waste products. A key theme running through all offerings is environmental friendliness - and this is an area that is likely to see further legislation.

Across all three divisions, spares and services account for 20 per cent of revenues, and 40 per cent of profits.

So, overall, Hamworthy is well-positioned in its markets and is well-run by a strong board. Legislation should help to underpin strong demand, while low-cost production should keep it competitive. Dividends are expected next year, and the is stock trading on an undemanding multiple. Buy.


Ord price: 163p Market value: 60m
Touch: 161-165p 12-month High: 165p Low: 123p
Dividend yield: See text PE ratio: 11
Net asset value: 14p Net debt: 140%


Year to Turnover Pre-tax Earnings Div per
31 Mar (m) profit (m)** per share (p) share (p)


2002 64.4 4.0 - -
2003 87.1 4.7 - -
2004 92.9 5.8 11 -
2005* 112.1 6.9 14 -
% change +21 +19 +27 -



*Collins Stewart estimates
**Pro-forma
Market makers: 2
Normal market size: 5,000
Last IC view: 2 Jul 2004, page 17
At float

BULL POINTS
Strong order book

Good institutional backing

Impressive product range

Well-placed for growth

BEAR POINTS
Limited broker coverage

No track record as a quoted company



cheers GF.

Looks good to me GF I'm in already.

MS

Nice move up again on a P/E of around 12, and is very cheap.

cheers GF.

Todats tip from UK analyst.com............

Buy Hamworthy at 171p
Rob Cullum of TrendWatch.co.uk
When you think of big, successful, world-class engineering companies, what springs into your mind? Germany, perhaps? Or maybe one of the giant Far East trading houses such as Hyundai, Mitsubishi or Hitachi. Despite our proud post-industrial revolution heritage, you don't normally think of engineering and Britain in the same breath, except perhaps for Rolls-Royce.

But we do have many world-class engineering businesses. One of them surprisingly only floated on AIM in July. Even more surprising, it's a business that the average person on that other engineering marvel, the Clapham omnibus, has probably never heard of.

The company is Hamworthy. Its speciality is marine engineering, with the emphasis on fluid handling. So, for example, it makes pumps and equipment for getting crude oil and natural gas onto and off tanker ships. It also makes systems for handling dry cargoes. It makes the refrigeration systems for liquid petroleum gas (LPG) and liquid natural gas (LNG) carriers. It's the world's leading manufacturer of marine sewerage treatment systems, fitted to ferries all the way up to the world's biggest cruise liners. It supplies specialised equipment to military naval fleets worldwide, where requirements in terms of reliability, shock resistance and fire resistance are especially onerous. It supplies equipment for all types of vessels involved in offshore oil exploration, including seismic vessels, drill ships, oil rigs, shuttle tankers and pipe-laying craft.



The company has major establishments in the UK, Norway, Denmark, Singapore and a modern assembly plant in China, which helps to keep its products highly competitive.

Given the recent flotation on AIM, it may come as a surprise that the company's history goes back nearly a century, to 1911. It was acquired by engineering conglomerate Powell Duffryn in 1962. Powell was the subject of a private equity takeover in 2000. Its owners refloated Hamworthy in July via a placing at 109p.

These days, you should never be put off by the fact that this is an AIM company. Many AIM companies are bigger than their fully listed brethren. Hamworthy is capitalised at 60 million pounds and rising. Its annual turnover has risen from 64 million pounds in 2002 to almost 100 million pounds now; pre-tax profit rose from 4.0 million pounds to 5.8 million pounds over the same period and in May its order book stood at a record 98 million pounds.

There are several drivers for this growth:

The ever-tightening environmental, safety and noise regulation. The days when ship operators could treat the sea with contempt as their private cesspit and waste oil dump have long gone.

The demand for oil and gas transportation is growing.

The market for cruise tourism is expanding.

There is a growing trend to utilise FPSOs (floating production, storage and offshore loading) vessels, which are full of the sort of equipment in which Hamworthy specialises.



Furthermore, thanks to the extreme conservatism of the marine industry, there are serious barriers to entry for would-be competitors. Given the potential for disaster at sea involving explosive cargos, it isn't surprising that Hamworthy's customers often require extensive lists of user references and evidence of years of successful operation before they'll even consider ordering a particular marine system.

Despite that fact, this is a fragmented industry, giving Hamworthy plenty of opportunities to grow via acquisitions as well as organically.

This combination of a long history, major growth drivers and barriers to entry has resulted in Hamworthy becoming the world's number 1 in deepwell pumps (for pumping gas and oil cargoes), with 95% of the global market. It's also no.1 in gas reliquefaction systems and in water treatment systems. It's the global no.2 or no.3 in most of the other products that it supplies.

Its new gas reliquefaction system could turn out to be a real winner. Exxon and Conoco are currently testing it. Some gas boils off from the LNG cargo during the voyage. Currently, liquid gas carriers use this boiled-off gas to power steam generators to power the vessel. This is actually an inefficient use of energy. Hamworthy has developed an on-board gas reliquefaction system, enabling the ships to use more efficient, low maintenance diesel engines. The reliquefaction system costs 2 million pounds - 5 million pounds but should save 3 million pounds p.a. for each LPG vessel.

We don't yet have the benefit of broker research for this company, though no doubt that will change quite quickly, given the attention the flotation attracted from institutional shareholders (the placing was oversubscribed). House broker Collins Stewart reckons that profits will rise from 5.8 million pounds to 7 million pounds this year and to 9 million in 2005-06. If correct, this puts the shares on a lowly p/e of under 7 for 2005-06. We'd expect to see a share like this rated at more like 12 at the very least.

It also suggests that the company was floated too cheaply. This is the earliest opportunity we've had to recommend the share, which has performed strongly since flotation. There's a window of opportunity here to pick up the share while they still look seriously underpriced. Don't delay too long, though. At the rate the shares are rising, the window won't be open that much longer. BUY

Key Data

EPIC: HMY
NMS 5,000
Spread 169p - 173p
Market Cap 62.16 million pounds

cheers GF.

Good write up -a long term hold for me. Thanks GF

I'm in for the long term. I reckon these shares will rise for quite a while.

Nice to have you guys aboard.

cheers GF.

Just joined you with a few of these boy's.
Got out of Cambridge Mineral Resources (at a loss i'm afraid') and rolled into HMY, hoping for steady med. to long term growth.

Good Luck......... Rob

This is another one the market has been slow to notice. Good recommend from one of the tipsters on HMY. can't remember which one but it was good to read!!

Told you lads, me and Jason in from way down, I dare not look, but its still way undervalued and trades on a lowly historic P/E never mind forward P/E.

The Broker floating it made a 'right cock up' and thats the truth I have heard from the city, should have floated at 180p, but who cares know what I mean.

cheers GF.

Hi GF. Finally returned from my travels to see HMY has been doing nicely in my absence. Can't believe how much these have gone up over the past few weeks and they still have plenty of upward movement by the look of the chart. Sticking my neck out, but I can honestly see us reaching 2 by Christmas. We should be due some results on the 22nd of November which will spark a few brokers into life. In the meantime, enjoy the ride!!

Ian, if your reading this, could you have another look at the header of this thread for me?

jason,

No problem - what would you like it changed to? Post here and I will get JT to chnage it when he comes in,

Ian

Cheers Ian, if we could revert back to "Hamworthy global oil services leader with rapid growth potential" that would be great.

Thanks again, Jason.

Will get it done as soon as JT is here.

Ian