In timely fashion JHX is due to report after the US market closes tonight hence the likely volatility will unfold on Wednesday on the ASX:
- For the third-quarter net sales are estimated at $US1.21bn and adjusted net income at $US133.2m.
This is one company that has been a serial disappointment over recent years, from downgrades to an extremely unpopular acquisition of outdoor living business AZEK in a cash-and-stock deal valued at about $US8.75 billion (including AZEK’s net debt) – investors weren’t keen on the price paid, but it was how the deal was structured that caused the most frustration. JHX didn’t need or seek a shareholder vote despite issuing a large amount of new stock (~35% of existing capital) to fund the acquisition – investors felt blindsided. One year on, and JHX is still trading 30% below where they were trading before the AZEK news crossed our screens, and it’s time for the company to start appeasing shareholders.
We see room for surprises on the upside from JHX, but history has us holding on tight!
- We can see another test of the $40-45 area “if” their result is okay: MM owns JHX in its Active Growth Portfolio.
MM is long and bullish towards JHX
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