Cimic Group is under Algo Engine sell conditions. Despite this, we’ve held a view that the company has cleaned up the balance sheet and offers exposure to an increasing infrastructure build thematic.
The FY20 earnings result and FY21 guidance was below market consensus and we’ve seen the stock sell off as a consequence.
You're not a member! Trial today
FY21 NPAT guidance of $400-430m down from FY20 NPAT of $600m.
The silver lining is the business does appear to be de-risking and likely to manage its way through the transition to new, lower risk contract wins.
The forward yield is now 4%, but the free cash flow generation will need to be watched closely.
