Shares digital

Kier (KIE) – Interims PTP: £44.6m (£36.2m) Divi: 18p (9.6p)

Kier’s results suggest that mixed-model construction companies are withstanding the currently fragile economic outlook. Taxable profits came in 23.2% higher at £44.6 million, on the back of a 20% increase in revenues to £1.17 billion. The interim dividend was raised by 87.5% to 18p and the orderbooks are more than healthy, especially in the construction and support services divisions, which benefit from long-standing client relationships, good visibility of earnings and improved margins. House broker Landsbanki made a small adjustment to 2008 EPS forecasts (-3%) reflecting lower house building volumes The share price, 45.5% down from last year, has picked up a little, implying an 8.5 times 2008 PE and 3.9% forecast yield.

Shares says: The shares are good value at £13.60 and discount a major downturn that has to happen yet.

by: Carlo Svaluto