【出版时间及名称】：2010年1月英国中型制造业研究报告
        【作者】：汇丰银行
        【文件格式】：pdf
        【页数】：84
        【目录或简介】：

Pricing pressure has yet to materialise
fully, but we believe inventory volatility
could be delaying the effect
􀀗 Weaker pricing, higher input costs and FX
headwinds could all hinder the market’s
expectation of a V-shaped margin recovery,
driving the risk of multiple compression
􀀗 We see better value in early cycle names
(Cookson and Morgan Crucible both
OW(V)), but expect delayed recovery for
later cycle plays, including Charter,
Invensys (both UW(V)), Rotork and Spirax-
Sarco (both UW)
In our mid-cap industrials sector review in Q2 (Industrial
Vertigo – April 2009), we highlighted that in a beta rally, share
prices had the potential to rerate to recessionary recovery
multiples offering significant short-term upside if lead
indicators turned positive. However, we held the belief that
earnings for some companies would remain depressed due to
shifts in end-market mix and pricing weakness. Whilst the first
two of our assumptions has occurred, the issue of pricing
pressure has yet to materialise fully in 2009 performance, but
we feel has been partially dampened by the process of
destocking and remains an underestimated risk in 2010.
Our analysis also concluded that earnings forecasts across the
UK industrials sector assume one of the shallowest recessions
in recent history. Since H12009, EPS growth estimates have
been upgraded further from -1% to +5% in 2010e and from
+2% to +7% in 2011e, which implies an optimistic view of
margin recovery. In light of a cautious backdrop for pricing,
potential inventory volatility and FX headwinds we see the risk
of a slower than anticipated recovery in earnings which could
result in potential earnings multiple compression.
We retain our OW(V) rating on Cookson and upgrade Morgan
Crucible to OW(V) from N(V), but remain negative on
Invensys (UW(V)), Rotork (removing V flag) and Spirax-Sarco
(both now UW). We downgrade Charter from N(V) to UW(V),
given late cycle exposure and a slower recovery in welding
equipment demand. We have also upgraded Weir Group to
N(V) from UW(V) owing to our reappraisal of the group’s
defensiveness and the potential for a recovery in its early cycle
oil & gas activities. We retain our N(V) rating on Spectris.