ALQ +4.76%: the technical testing company rallied on upgraded guidance today, and confirmed a strong liquidity position post the sell-down of their Asset Care business to SRG Global (SRG). Underlying NPAT was upgraded ~2.5% at the midpoint, while just a small number, it does confirm they have managed cost pressures well and continue to see organic growth coming through the business.
Technical testing stock ALQ has performed strongly post-COVID including growing revenue by 24% in FY22, considering its performance a valuation of 20.4x FY23 earnings isn’t too prohibitive while an estimated 3.5% yield is supportive. This company provides essential testing, inspection and certification for other companies including the mining industry which MM is bullish about over the coming years.
ALQ +1.95%: technical testing company ALS presented FY22 numbers to the market today, coming in slightly ahead of expectations. Revenue grew 24% to $2.2b, and EBIT was up 36% for the year to $409m, around 2% ahead of consensus. The commodities segment saw EBIT growth of over 40% thanks to a strong tailwind of volumes and price increases. Life Sciences also saw solid growth, organic EBIT growth of 29% plus an additional...
Laboratory testing, inspection and certification business ALQ remains 16% below its 2021 high, we feel as commodity prices continue to rally the backdrop for exploration remains strong. We’re bullish the Queensland based business targeting a a break of its 2021 high but the risk / reward is not particularly exciting hence if we were long it would be a hold but we need it under $11 to become attractive as a buy.
ALS Global (ALQ) is a commercial services business that offers laboratory testing to commodity, life since and industrial sectors. It was traditonally known as the place to get mining samples assayed however their operations are now more broad than that. Low margins often mean earnings fluctuate significantly, however it's a business on the improve.
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