Astaldi SpA is an Italian company active since the 1920s in the construction of railways (including high-speed lines), subways, bridges, roads, motorways, ports, airports, dams, thermal, hydroelectric and nuclear power plants, oil and gas pipelines, sewage treatment plants, car parks, hospitals/clinics and industrial buildings. It is also engaged in the operation of car parks and motorways. Astaldi is the second largest Italian contractor and one of the top 25 in Europe in the construction sector. The company is active nationally and internationally, in over 70 countries. It has a turnover of almost 3 billion euros and has almost 11,000 employees.
Astaldi is currently literally being sold off. Its price/earnings ratio is only 5.9, the price/book value ratio is only 0.9 and the price/sales ratio is only 0.2. The dividend yield is also particularly interesting, at 3.4%, even though the distribution ratio is only 19.9%! This leaves a lot of room for the company to either increase its dividend even more or to invest in the development of the company.
Astaldi creates value over the long term, by increasing its profits, dividend, asset value and cash reserves. This proves the reliability of its business model. Although over time the growth in value is not in doubt, let us nevertheless note years with negative cash flows, as was the case recently in 2016.
Cash reserves are sufficient for the company to meet its current financial obligations, but not too large either, which would demonstrate poor use of current assets. The current ratio is even slightly up, at 1.37. Gross margin is also slightly up, at 84.3, as is return on assets, at 2.05%.
A small shadow on the horizon, in addition to the negative cash flow of 2016, a slightly increasing debt ratio, at 31,35%. Debt is not necessarily bad in itself. It can even represent an opportunity because it constitutes a leverage effect. By resorting to debt, Astaldi also avoids financing its expansion by an increase in the number of shares in circulation, which is positive for the shareholder. Nevertheless, we would still prefer to see a downward trend in debt over time compared to the company's assets.
With a history of almost a century, Astaldi operates in a defensive sector, sheltered from major economic and financial earthquakes. The company is currently a real bargain, despite the two black spots noted above. I believe that the price can double in the coming years, as can the dividend (already very generous).
So I just took a position on this title.
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My bad, really screwed up on this one... Capital increase and big spanking on the stock price. Fortunately the Japanese are catching up.
yes, but a bit short comment; at the current rate is it interesting? obviously patience would be required
The decline only reflects the planned capital increase of 200 million euros. So a share is worth 2x less than before. The stock was undervalued before. It still is, but no more than before. Unless this planned capital increase does not take place in these terms.
Indeed, there is no point in getting excited in the short term, whether for falls or for rises.
never despair, and thanks for pointing out astaldi: bought cheap and going up, up……
🙂
Still proud of your investment?
I have never been proud of an investment, even with my baggers. The stock market for me is just a game where you win more often than you lose, because yes, sometimes you lose. The important thing is that on the quantity and the duration, you win.