- The industrial sector index, S&P/ASX 200 Industrials Index, has fared reasonably in 2021 with a YTD return of 7.94%.
- The index is a broad one consisting of businesses across the manufacturing and supplying capital goods, commercial services provision, and provision of transport services.
- CIMIC Group, Johns Lyng, Seven Group, and NBN Co are some of the trending stocks in the industrial sector.
The S&P/ASX 200 Industrials Index is a broad one and includes companies engaged in manufacturing and supplying capital goods, providing commercial services, and providing transport services.
The sector index has performed reasonably on a YTD basis with a 7.94% return (as of 22 July). A few companies in this space have been under the spotlight, led by significant announcements.
This article would walk you through five trending industrial stocks.
Source: © Khunaspix | Megapixl.com
CIMIC Group Limited (ASX:CIM)
CIMIC Group, a world-leading infrastructure, mining, services, and public-private partnerships group was under discussion, post it released its 1H FY2021 results on 21 July.
In the first half, Group revenue was up 4.8% to AU$4.6 billion.
Other highlights are detailed below:
- NPAT for the period was AU$208 million.
- Free operating cash flow pre-factoring increased by AU$166 million compared to the previous corresponding period.
- CIM maintained a strong balance sheet and has AU$4.3 billion liquidity.
- It declared an interim dividend of 42 cents per share.
During 1H FY2021, the Company was awarded new work worth AU$10.4 billion. The value surpassed the work awarded during FY2020.
In the last three months, CIM shares improved by 18.4%. On 22 July 2021, the shares settled at AU$21.100, up 6.297% from the previous close.
Johns Lyng Group Limited (ASX:JLG)
Integrated building services group, Johns Lyng Group Limited, was trending post the Company provided an update related to the acquisition of Unitech.
On 12 July 2021, the Company announced that it acquired a 60% controlling equity interest in the South Australian-domiciled insurance building services business, Unitech Building Services. Post the completion of the process, JHG paid AU$1.9 million in cash from its reserves along with a prospective future earnout depending on the financial performance of FY2021 and FY2022.
In the past three months, JHG shares have improved by ~34%. On 22 July 2021, the shares settled at AU$5.34, up 2.692% from the previous close.
NRW Holdings Limited (ASX:NWH)
NRW Holdings offers civil contracting, mining services, as well as equipment to the resources sector.
NWH has been in the limelight after Boggabri Coal Operations Pty Ltd exercised an Option to obtain the majority of the mining equipment of Golding Contractors Pty Ltd. The equipment is engaged under the Maintenance Services and Hire Contract at the Boggabri Coal Mine.
Boggabri Coal Operations Pty Ltd forms a part of Idemitsu Group. Golding Contractors Pty Ltd is a 100% subsidiary of NRW Holdings Limited.
The deal would see the sale of 38 crucial mobile mining assets from Golding to Boggabri Coal by the closure of July 2021.
In the last three months, NWH shares slipped by ~14%. On 22 July 2021, the shares settled at AU$1.755, up 2.932% from the previous close.
Seven Group Holdings Limited (ASX:SVW)
Leading Australian diversified operating and investment group Seven Group Holdings Limited was under the spotlight because of the announcement related to the Boral takeover offer.
On 15 July 2021, Seven Group Holdings confirmed that it received approvals under the Offer such that its total interest in Boral Shares is up to 52.65%. It comprises economic interest of equal to 3.33% held via an equity swap transaction. Further, the Company highlighted that the arrangement does not give SVW the voting power in Boral shares.
The Company believed the chance that the voting power to exceed 50% before the scheduled close of the Offer on 15 July 2021. In its supplementary target released on the same day, SVW highlighted that the offer period got extended and scheduled to close at 7:00 PM on 29 July 2021.
In the last three months, SVW’s shares dropped by ~1.7%. On 22 July 2021, the shares settled at AU$22.200, up 0.817% from their previous close.
Downer EDI Limited (ASX:DOW)
Downer EDI Limited, the leading provider of integrated services in ANZ, was under discussion after NBN Co awarded the Company two contracts.
- The N2P Evolution contract: This contract starts in July with an initial term through to December 2023. There is an option to extend the deal for another two years. The contract is worth AU$160 million to DOW for the first two and a half years.
- The nbn™ Fixed Wireless Services contract: This contract starts in July 2021 and would initially be for two years with an option to extend for two years. The projected value of the initial term is AU$60 million and the total estimated value, involving both extension options, is equal to AU$120 million.
In the last three months, DOW shares have delivered a marginal growth of 0.742%. On 22 July 2021, the shares settled at AU$5.430, up 1.305% from the previous close.
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