By Malcolm Stacey | Friday 19 May 2017
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
Hello Share Twiddlers. Continuing my theme that companies which build houses should do jolly well out of the various election promises to stimulate house building, I offer for your critical perusal another lot which services the building industry.
Van Elle (VANL) is a strangely named outfit that only went public recently. Unlike some firms which float, this one was already doing very nicely as a private set-up. It operated in that world for 32 years.
What does it do? It specialises in piles. Not the kind your granddad suffers from, but piles, foundations and ground engineering. That is stabilising land for builders to plonk their erections on. Van Elle is a bit of a pioneer too, finding new ways to make land capable of being built upon.
The company has an enviable reputation for making cold cash. It had a pre tax gain of £10.7 million last time from £85 million’s worth of revenue. The chairman has loads of skin in the game - still owning about a fifth of the firm. And at least one other big cheese holds a big lump of shares.
You’ve all heard me bang on about Whitehall’s pledges to improve the climate for builders. Only a poor builder - and admittedly there are a few about the place - can fail to take advantage of this benign climate.
Does Van Elle have decent customers? Well, it certainly has big ones - including Bellway (BWY) Bovis (BVS) and Balfour Beatty (BBY). Its recent airports projects include Birmingham and Manchester control towers and radar stations. It also supplies Network Rail. So you don’t necessarily have to build homes to be a client.
A dividend is being vaunted, too. So a firm with a good, erm, foundation for shares to grow in price.
And now it’s time for the Punter’s Return.
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