Johnson Matthey PLC : Commodities trader
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05/18/2012 | 04:30am
Opinion : Bullish above 2050 GBp
Target price : 2400 GBp
Stop loss: 1960 GBp
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LONDON STOCK EXCHANGE
Chemicals - Specialty |
Johnson Matthey is a specialty chemicals company which manufactures catalysts, pharmaceutical materials, and pollution control systems. The company also refines platinum, gold and silver, and produces colour and coating materials for the glass, ceramics, tile, plastics, paint and construction industries.
The company is correctly valued, in fact is trading 15 times its earnings per share estimate for full year, according to Thomson Reuters’ consensus. The trading activity still has strong performance, even if suffers of low commodities’ prices. Thomson Reuters forecasts earnings per share for this financial year up more than 30% to 139 pence.
The share went out from its neutral range between 2247 / 2408 GBp. In the past trading sessions the share was penalized by market’s conditions, which pushed the stock close to technical support. In weekly data the trend is still in bullish trend, for this reason we forecast a share’s recovery could lead the share again in the area of 2400 GBp. We suggest a stop loss below technical support at 2000 GBp.
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Valuation |
2013e |
2014e |
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PER (Price / EPS)
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19,0x |
17,9x |
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Capitalization / Revenue
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0,52x |
0,49x |
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EV / Revenue
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0,59x |
0,55x |
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EV / EBITDA
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11,4x |
10,7x |
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Yield (DPS / Price)
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2,13% |
2,32% |
| Profitability |
2013e |
2014e |
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Operating Margin (EBIT / Sales)
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3,82% |
3,82% |
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operating laverage (Delta EBIT / Delta Sales)
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-0,84x |
0,99x |
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Net Margin (Net Profit / Revenue)
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2,83% |
2,75% |
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ROA (Net Profit / Asset)
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9,17% |
9,45% |
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ROE (Net Profit / Equities)
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19,7% |
19,5% |
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Rate of Dividend
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40,6% |
41,6% |
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