Morgan Sindall Group

[Arborbridge]

I used to holdthem, decades ago. A quick glance at the number on the HL site makes me wonder why I dropped them, and what's not to like! Well, I bought into one or two companies in that sector and got burnt.
Where's the catch?

For a HYPer like me, they are a little small and the question I must address - a purely personal one - is do I want to stamp collect yet another holding?

Arb.

[bluedonkey]

This carries on the OT discussion about Morgan Sindall on the "Your Top Holdings" thread.

Dod mentioned culture. It's funny, I was going to mention it as a rare example of a company where I have been able to identify that intangible thing. As I mentioned, they have a long term history of being fairly strategic in positioning themselves for profit rather than chasing expansion. The CEO is a major shareholder and told me that he too values the dividends that the company pays out, so that aligns with me, though not in scale!

Dividends. From 2003 (the start of my holding) the dividend was increased substantially each year. However, from 2009 to 2012 inclusive the dividend was held. Then in 2013 it was cut by 36%. In 2016 they started increasing it again and by 2018 it exceeded the 2012 figure.

A lot of investors don't look past the low margin. In general, I would agree. In my 20y experience of this particular business, it would have been a mistake.

[monabri]

I think the 50% increase is a bounce back in shareprice similar to that seen in housebuilders ( eg Taylor Wimpey). MGNS appears to be a low margin business.

Page 5 of the 2023 HY Presentation...or, better, Page 6 where margins of the individual parts of the business are stated.

https://www.morgansindall.com/investors/latest-results


Edit. When I looked at the presentation I thought " pictures of buildings being constructed" ( Kier, Carillion) and the discussion on "order book" and minimum cash figures... Big order book..low margin...lots of scope for "problems ".

[Dod101]

I used to holdthem, decades ago. A quick glance at the number on the HL site makes me wonder why I dropped them, and what's not to like! Well, I bought into one or two companies in that sector and got burnt.
Where's the catch?

For a HYPer like me, they are a little small and the question I must address - a purely personal one - is do I want to stamp collect yet another holding?

Arb.

I noticed that they are quite small but they seem to have a good record stretching back some way. That suggests a decent ingrained culture. I am as I have said looking for something to replace my tobacco holdings. Obviously they will not have the same yield but that does not bother me.

I am looking for a conservative well run company and on the face of it at least Morgan Sindall seems to be that.

I need to have a read of the Annual Report but as I said, the CEO may or may not be part of the founding family. He holds about 10% of the shares as far as I can see. That is a good sign.

Oops see that blue donkey has posted but I will let this stand.

Dod

[Arborbridge]

I used to holdthem, decades ago. A quick glance at the number on the HL site makes me wonder why I dropped them, and what's not to like! Well, I bought into one or two companies in that sector and got burnt.
Where's the catch?

For a HYPer like me, they are a little small and the question I must address - a purely personal one - is do I want to stamp collect yet another holding?

Arb.

I noticed that they are quite small but they seem to have a good record stretching back some way. That suggests a decent ingrained culture. I am as I have said looking for something to replace my tobacco holdings. Obviously they will not have the same yield but that does not bother me.

I am looking for a conservative well run company and on the face of it at least Morgan Sindall seems to be that.

I need to have a read of the Annual Report but as I said, the CEO may or may not be part of the founding family. He holds about 10% of the shares as far as I can see. That is a good sign.

Oops see that blue donkey has posted but I will let this stand.

Dod

Let us know what your assessment is on checking the accounts. My initial reaction is that I do not need to get involved with another low margin business in and around construction. That was where my biggest mistakes lay previously, so I'd rather bolster up holdings in "pooled" investments at a similar yield with greater diversity.

A good company in a harsh sector?

Arb.

[Dod101]

I noticed that they are quite small but they seem to have a good record stretching back some way. That suggests a decent ingrained culture. I am as I have said looking for something to replace my tobacco holdings. Obviously they will not have the same yield but that does not bother me.

I am looking for a conservative well run company and on the face of it at least Morgan Sindall seems to be that.

I need to have a read of the Annual Report but as I said, the CEO may or may not be part of the founding family. He holds about 10% of the shares as far as I can see. That is a good sign.

Oops see that blue donkey has posted but I will let this stand.

Dod

Let us know what your assessment is on checking the accounts. My initial reaction is that I do not need to get involved with another low margin business in and around construction. That was where my biggest mistakes lay previously, so I'd rather bolster up holdings in "pooled" investments at a similar yield with greater diversity.

A good company in a harsh sector?

Arb.

Certainly seems to be a good company and with these margins it needs to be well managed and disciplined. You can see why they like to have cash in the bank. Provided they can maintain the culture they can go on and continue to succeed. The problem is that if the current CEO were to retire someone else could come in, take advantage of their cash and do well for a year or two and then fall off. Will give it some thought. I suppose what I am getting at is that it needs a very disciplined approach and not to quote Buffett I am not sure that an idiot could run it.

Dod

[BullDog]

I used to holdthem, decades ago. A quick glance at the number on the HL site makes me wonder why I dropped them, and what's not to like! Well, I bought into one or two companies in that sector and got burnt.
Where's the catch?

For a HYPer like me, they are a little small and the question I must address - a purely personal one - is do I want to stamp collect yet another holding?

Arb.

I noticed that they are quite small but they seem to have a good record stretching back some way. That suggests a decent ingrained culture. I am as I have said looking for something to replace my tobacco holdings. Obviously they will not have the same yield but that does not bother me.

I am looking for a conservative well run company and on the face of it at least Morgan Sindall seems to be that.

I need to have a read of the Annual Report but as I said, the CEO may or may not be part of the founding family. He holds about 10% of the shares as far as I can see. That is a good sign.

Oops see that blue donkey has posted but I will let this stand.

Dod

You're right. Morgan Sindall is the one quality business in a terrible business sector and the only one I would regard as investable. As you say, family are still involved. They don't borrow money, they don't take on low margin loss leading contracts, they don't build speculative properties, they are very conservatively run and it shows. I waited quite a long time before buying the shares for the price to be right and I now regard them as a long term holding.

[BullDog]

A good set of results today from Morgan Sindall, dividend increases again.

https://www.investegate.co.uk/announcem ... 23/8049966