Ashtead has been a very good recovery stock.One to watch leading up to results 13th December and beyond.

Hi all .................. I too have been in / ot of this one over the last couple of years.

But what a drop today.

Tempted to get in at some point .......... Charts suggest it is oversold.

More views welcome.

Good luck
Amar

See what you mean Amar, this one has been off my radar for a couple of weeks so hadn't realised they have dropped from the low 80's. mmm
2517

what's going on here?
down 14%-8 3/4

And yet the Company keeps buying shares almost everday??????

Are any of us brave enough to dip in ................ or do we wait for results?

Cheers
Amar

Toya kindly pointed my sticky fingers at this one, so i bought a few on Friday .... wonder how the news below will affect sp tomorrow ......


Equipment rental group Ashtead Plc., which has recently seen its share price spike on bid rumours, is on the verge of selling its oil and gas technology division to a private equity firm for about 100 million pounds, according to The Sunday Telegraph.
The newspaper said it has learned the company received final-round offers for the division from buyout firms Phoenix Equity Partners and Barclays Private Equity.
Lloyds Development Capital was also in the final round, but it is not clear whether it decided to submit an offer for the business, the article added.
Banking sources said one of the private-equity bidders is likely to move into exclusive discussions in the next couple of weeks and a deal could complete soon afterwards, the newspaper said.

Current broker target set 26.5.08 is 76p.
Any idea where this is heading based on the news, or is this just a hopeful punt?

Harrycat: article from The Times, 28May2008 alerted me to this one:

"This is a gloomy time for the construction industry, particularly companies with exposure to the US, such as Ashtead, the forklift truck and crane hire group. So dealers were dumbfounded yesterday when its shares shot up 11 per cent on 12 million traded - some six times the usual volume.
"The shares closed up 7p at 75p, sparking talk of a bid. An approach from management had been mooted late last year. The rise on such high volumes is too big for the broker upgrade initially rumoured. More likely is that Ashtead is close to selling its oil and gas technology business, which hires underwater cameras and portable weather stations to the booming energy industry. A deal is likely to be concluded in time for results on June 26.
"The company said recently that sale talks were progressing well, having appointed N M Rothschild in April to find buyers for the arm, expected to fetch up to 100 million, which will help to bring down its 1 billion debt. Matthew Earl, who covers Ashtead for Investec, its house broker, said: The most likely thing on the cards is the sale of the oil service business.

Ouch! 1b debt!!! 100m isn't going to make much of a dent in that. So short term spike in the sp then?

By my rough calculations,the results just announced(76 million profit ) puts the company on a P E of just 2!

Maybe, but the sp looks at the future and building sector is dire - look at Estate agents going out of business and homes half-built. Hence the Hire industry will not have the resources to replace their old/rusting kit... IMHO...arrgh!

I can't argue about the economic problems,but Ashtead results look much better than expected,and with Obama stimulus plans and the like,tool hire may be the option more widely used.
There follows an article from The Daily Telegraph.

Ashtead lifted by US and UK infrastructure spending plans
Ashtead Group shares jumped after the construction equipment hire company said Government plans to increase infrastructure spending could start to boost the market by the end of 2009.

By Graham Ruddick
Last Updated: 1:42PM GMT 09 Dec 2008

Ashtead Group
The company said statements from political leaders in the US and UK were "encouraging" and that they could benefit as smaller rivals collapse and contractors increasingly choose to rent equipment rather than invest in their own because of financial constraint and uncertain order books.

Alistair Darling, the Chancellor, has said 3bn of public sector spending in the UK will be brought forward into 2009 and the Barack Obama, the US president-elect, has announced that he plans investment in national infrastructure not seen since the creation of the highway system in the 1950s. Both schemes are designed to stimulate the economy as concerns about rising unemployment grows.

However, Ashtead warned they were yet to see "firm financial commitments" from governments.

Ashtead, which conducts 85pc of its business in the US, was speaking as it revealed mixed results for the six months to October 31 and unveiled a cost-cutting programme to ensure the business is the "right size" for the anticipated levels of demand.

Pre-tax profits slumped 44pc to 39.5m in the half-year as the company incurred 37.1m of exceptional charges through the downsizing of the business. Underlying pre-tax profits rose to 76.6m from 71.5m.

Ashtead, which rents out a range of industrial equipment from diggers to small tools, has launched the cost-cutting programme after being hurt by the slump in housing and commercial construction.

The outlook for infrastructure construction in utilities, prisons, schools and transportation remains "good" for the medium term but future strength will depend on the Government proposals, it added.

Store closures, headcount reductions and a downsizing in the number of delivery vehicles have been applied by Ashtead with the aim of saving 45m in costs annually. The company reduced its staff from 9,594 worldwide to 9,381 during the period, although 130 of those were from the sale of Ashtead Technology.

The 89.8m generated from the sale of its oil and gas technology division was used to pay off the company's troublesome debts, which still managed to rise to 1.1bn from 963m because of the strengthening dollar. However, the company said the debt facilities were long-term and were structured to be "effectively covenant free".

Geoff Drabble, the chief executive, said: "Ashtead has continued to perform well against the background of weakening market conditions. Our strong and diversified market positions have and will continue to benefit the group but it is also important that we take prompt actions based upon realistic assumptions of the future trading environment.

"Longer term, our strong market positions, long-term committed debt facilities, cash generative and flexible business model and the decisive restructuring exercise which we are undertaking allow the board to view the future with confidence."

Shares in the company were trading up 5.5p - or 18pc - to 36.50p at lunchtime.

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Goes ex-div on the 28th jan '09.
Set to yield 6.0% in 2009.

Ashtead is up from under 30p ,so has had a good run of late.Some pullback is now taking place.
Prospects look better with the Obama stimulus package set to kick in.
Also,Ashtead has done the rags to riches thing before,going from 10p to 240 a few years ago!

Chess

Or done the riches to rags before - depending on when you start your chart !!!!

Quite right!
At least however,they are at the stage where they are putting on new clothing!
That dividend loks good.

IMHO any rise is due to USA having a new President - but until he produces the stability required over there, we are only Trading a false dawn.
What's surprising is the purchase of their own shares . . .. when will companies stop destroying shareholder funds by this stupid activity?
If they'd wanted to - they should have done so a few months ago with the sp abt. 30p - - - but I suspect it will return, making recent buy-backs the same as burning the cash.

Surely it's easy to say now that they should have bought at 30p. It's possible that they now expect the sp to rise further, in which case 42p will seem a good price.
I have got to agree that share buy backs have been generally bad news for companies recently, but in a falling market that will always be the case. Assuming that the market is now going to sideways trade for a while before the upturn, this particular buyback may seem a good idea in 12 months.
I am happy to hold my stake in AHT for now in anticipation of better times towards the end of 2009.

It's not looking like a good idea at the moment, distinct lack of support at the moment, looks like your comments (hangon) were spot on. Unfortunately I bought in last week and am now 15% down, if it hits 30p again will top up as that could possibly be a double bottom, or just an opportunity to suffer a little more for the next few months. Should do well on a long term basis, so more profit later.

steveo - did similar buying in this week, and have every intent to add should the price hit 30.5 (easier to get the order filled).

Have swung between a pro-buy back and anti buy-back person over the months but looking back it has to be anti. The pro-argument is EPS based, but the SP graph is market based, and carries much, much more weight.

One of the oldest adages on the market is not to fight/buck the market - we seem to have to learn the same lessons over and over. Perhaps buy backs would make sense on a rising trend ?

MoneyAM
"Equipment hire company Ashtead's pre-tax profits fell 41% in the third quarter to 11m.

But the firm says the 45m cost-cutting programme announced in December is now substantially implemented.

It said third quarter performance in line with expectations in its seasonally most uncertain period and revenue for the nine months to the end of January rose 8% to 798.6m.

It said all debt is committed for the long term and structured to remain covenant free.

Chief executive Geoff Drabble said: Whilst we are operating in difficult and uncertain markets we have been preparing for these conditions for some time.

'Our actions in right sizing the business, which are already evident in our performance, together with our strong balance sheet allow the Board to anticipate full year results for profit and cash in line with our expectations'."