You are here: Home -

Stock of the Week: Hill & Smith

Written by:
Ian Forrest, investment research analyst at The Share Centre, picks Hill & Smith as stock of the week.

This week’s share of the week is Hill & Smith, a company that supplies a range of infrastructure and galvanizing products to customers in the UK and markets around the world, mainly the US, Australia, France, India and Thailand. Its range includes road safety barriers, pipe supports for the energy sector and coatings for fencing and structural steelwork.

Though the shares have underperformed so far this year, the recent trading update in November provoked a positive response, prompting the shares to trade on a 2019 p/e ratio of 13.9. That is attractively low relative to the group’s main peers.

The company said revenues in the third quarter had risen by 12% and the UK government had confirmed a 66% increase in funding for the next Road Investment Strategy, from 2020-25, amounting to £25.3bn. That is a real positive for the company’s UK operations. It said full year results were expected to be in line with market expectations.

The group offers an attractive dividend yield of 3.0% which is relatively good for the sector, although payouts will probably only rise modestly over the next few years.

While the company faces some challenges in relation to rising commodity prices and a more difficult environment in the UK, many of these appear short term in nature and most of its international businesses continue to trade well, so we continue to recommend the shares as a ‘buy’ for investors willing to accept a higher level of risk.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Your back-to-basics ISA guide for 2020/21

You have until 5 April to use up the remainder of this year’s ISA allowance before it’s gone for good. Her...

A guide to Sharia savings accounts

A number of Sharia savings products have upped their game in recent months, beating more familiar competitors ...

Five ways to get on the property ladder without the Bank of Mum and Dad

A report suggests the Bank of Mum and Dad is running low on funds. Fortunately, there are other options for st...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Money Tips of the Week

Read previous post:
cold call firms
Cold call bosses can now be fined up to £500,000

Bosses of firms that bombard people with unsolicited nuisance calls will be liable for fines of up to £500,000 under...