Kier Group is a leading construction and services company in the United Kingdom, with building, infrastructure, maintenance, and more operations. However, in recent years, the Kier share price has tumbled dramatically amidst financial difficulties and an uncertain economic environment. Understanding recent developments with the Kier share price is essential for investors and those interested in the UK construction sector.
This article will provide background on the company, discuss the Kier share price forecasts for 2023, outline the outlook for the future, and provide an overview of companies similar to the Kier Group.
As a publicly listed company, Kier Group does not have a single owner per se. Instead, ownership is dispersed across a broad shareholder base comprised of institutional investors, hedge funds, pension funds, retail investors, employees, and more. Some of Kier’s top shareholders include:
Blackrock Investment Management (UK) Ltd. - 36,620,789 Shares
BlackRock is Kier’s largest shareholder, with a total stake of over 8%. The asset manager has trimmed its ownership over recent years amid Kier’s slide but maintains the biggest position in a possible bet on long-term share price recovery. Its substantial holding reflects enduring confidence from one of the industry’s preeminent institutional investors.
Schroder Investment Management Ltd. - 30,517,689 shares
The UK arm of global asset manager Schroders controls nearly 6.8% of Kier stock. Despite the company’s difficulties, Schroders has maintained ownership as a signal of its optimistic outlook on construction shares.
M&G Investment Management Ltd. - 27,904,730 shares
M&G’s 6% plus stake also ranks among Kier’s foremost institutional owners. The fund manager is aligned with BlackRock and Schroders in preserving sizable investment amidst broader doubts, pointing to latent upside potential it continues reorganizing successfully.
Woodford Investment Management Ltd. - 22,901,145 shares
Money manager Neil Woodford owned over 5% of Kier before liquidity crises forced him to offload the position at fire sale prices as his flagship fund imploded. While no longer a current top holder, Woodford’s past presence is an essential reminder of former institutional interest.
Kier’s owner registry analysis reveals enduring convictions from several top UK institutional investors despite extreme share price dislocations. Their significantly maintained positions suggest that patient shareholders could be rewarded if Kier’s restructuring increases profitability and improves credit health in the long run.
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The UK construction firm Kier Group may finally enjoy some reprieve in 2023. Its equity could double if financial rehabilitation continues apace alongside sector tailwinds. However, years of torrid shareholder value destruction highlight lingering fragility despite recent stabilization.
January 2023: 68.50p
The year kicks off building on 2022’s finish above 60p. Momentum from cost-cutting successes continues to drive incremental gains early on.
February 2023: 78.50p
Kier’s trading update sparked a strong February rally by confirming another year of underlying progress on corporate restructuring efforts. Investors cheered on further evidence of the company's credit profile strengthening.
March 2023: 68.20p
Easing inflation lifts the UK construction sector outlook, although some firms issue warnings about input cost relief lagging contract timing. This triggers modest profit-taking in Kier, reversing some February enthusiasm.
April 2023: 76.70p
Contract award announcements in Kier’s latest statement outline business wins restoring more attractive order visibility after past droughts.
May 2023: 77.50p
Upbeat operations remain mostly on track heading into summer as analysts praise a healthy bidding pipeline and leaner structures.
June 2023: 75.10p
Equity markets enter a turbulent patch on summer doldrums. Investors lock in Kier profits amidst broader sector declines.
July 2023: 87.80p
The interim results of Blowout have been announced, and they confirm that the company’s turnaround plan has successfully achieved its financial targets. As a result, confidence in the company has increased significantly, leading to multiple brokers upgrading their ratings.
August 2023: 84.90p
Markets swoon as weak GDP data fans global recession fears. Kier gives back some gains alongside the overall equity slide.
September 2023: 115.00p
Kier announced it won a major public infrastructure contract, displacing struggling competitors. This affirms the competitive advantages of scaled players.
October 2023: 100.80p
The third quarter update keeps the positive run rate intact. However, stock eases from September’s multi-year peaks amidst profit collection.
November 2023: 108.80p
Reassuring trading trends persist while the credit rating outlook brightens to “stable.” Kier closes in on pre-crisis valuation territory.
December 2023: 105.00p
Year-end jump fades modestly to finish 2023 with an approximate doubling in share price. The decrease in the trade index value should not be alarming as it does not affect the potential for growth in 2024. Still, various factors affecting the Kier share price should be considered, which we will learn about in the following section.
While forecasts suggest the company’s equity may stabilize and recover ground in 2023, the Kier share price’s longer-term outlook depends on several three critical factors:
Central to rebuilding lost value is the effective execution of Kier’s bold corporate reorganization and turnaround plans. Management is targeting over £250 million in cost eliminations alongside restoring contractor competitiveness after painful contract losses.
Early results are encouraging through simplified structures, business sales, and better capital allocation. Still, leaders cannot waiver on driving efficiencies amidst a tricky UK construction backdrop. Leaner operations are essential to surviving sector disruption.
Management must overhaul negative investor perceptions after enduring a disastrous collapse to catalyze a meaningful and long-lasting recovery of the Kier share price. Early analyst upgrades offer promise, but several years of flawless financial delivery are vital to regaining credibility. Patience will be required before institutional capital returns.
Lastly, broader UK construction markets govern revenue opportunities. Supportive property conditions, increased public infrastructure investment, contractor optimism, and the like would collectively support Kier’s ambitions of getting back on stable footing. But the sector faces no shortage of obstacles in disruptive times.
Beyond 2023’s potential for Kier share price firming, meaningful upside relies on Kier cementing operational turnaround successes to drive financial stability. This would gradually invite investors back.
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If you’re interested in keeping an eye on Kier Group’s competitors, you may want to consider the following companies:
- Keller Group (KLR): a geotechnical solutions provider
- Renew (RNWH): a renewable energy company
- Galliford Try (GFRD): a construction and housebuilding company
- Severfield (SFR): a structural steel specialist
- Costain Group (COST): an engineering solutions provider
- Morgan Sindall Group (MGNS): a construction and regeneration company
- Hill & Smith (HILS): a provider of infrastructure products
- Balfour Beatty (BBY): a construction and infrastructure company
- Renewi (RWI): a waste-to-product company
- Georgia Capital (CGEO): a diversified investment company
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While forecasts suggest the Kier share price could recover lost ground in 2023, traders should carefully weigh the risks and uncertainties facing the company before investing. Years of financial distress highlight the fragile situation despite early signs of a successful turnaround.
Investors would be wise to monitor operational restructuring execution, shifting analyst perceptions, and prevailing UK construction industry trends when evaluating the investment case.
Do your due diligence and closely track fundamentals to make informed decisions before trading this turbulent stock.
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