Analyst Views: What is your verdict on Meggitt’s half-year results?
SASH TUSA | EDISON INVESTMENT RESEARCH
When a company describes its markets as “challenging” in the headline and focuses on orders and not profits, you can tell that the rest of the results are below par. With shares below early-2014 levels, the likelihood of another major debt-funded acquisition on the back of the strengthened balance sheet is now harder for shareholders.
BEN BOURNE | LIBERUM
The market is likely to downgrade its full-year earnings per share forecast by eight per cent to around 34p. Military revenue was weaker than expected. Foreign exchange movements, disposals and an unusually high second-half weighting reduced the first-half margin. However, orders grew by nine per cent.
MIKE VAN DULKEN | ACCENDO MARKETS
The change in management’s outlook and growth forecasts comes from declines in military sales becoming even more severe than it had anticipated. Investors don’t look to be hanging around for a second-half recovery nor taking the eight per cent interim dividend increase as recompense for staying the course.