Kier Group share price edges higher with turnaround plans on track
The beleaguered construction company saw its share price climb higher on Thursday after telling investors that its turnaround plans are on track and it is making ‘good progress’ on cutting costs.
Kier Group shares climbed as much as 7% higher to 83p on Thursday morning after telling investors that its turnaround plans are firmly on track.
The construction company said that its trading for the period from 15 November to 31 December was in line with its own guidance, with the company winning new contracts across all markets it operate in.
Kier also told investors that it continues to watch its net debt ‘closely’ and has made ‘good progress’ to reduce costs, with the company closing offices, outsourcing some functions and making job cuts.
‘The work to re-shape the group continues through the careful execution of our strategic priorities and efforts to significantly reduce the group's cost base,’ Kier Group chief executive officer (CEO) Andrew Davies said.
‘The group is performing in line with our expectations and we continue to win work from our customers,’ he added.
Kier saw its early morning gains erode over the course of Thursday’s session, with the stock trading at 78p a share as of 16:10 GMT.
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Liberum Capital and Peel Hunt reiterate ‘buy’ rating for Kier Group
Analysts from Liberum Capital and Peel hunt remain optimistic about Kier, with the pair reiterating their ‘buy’ ratings for the stock in January.
However, analysts from US-based investment bank Jefferies set a ‘hold’ rating for the stock and downgraded their price target on its shares from 110p to 100p, implying a potential upside of 28.2%.
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Kier Group sees short sellers retreat
Kier Group was once among the top five shorted UK stocks, but with the company making good progress with its turnaround strategy short sellers have retreated slightly.
The struggling construction company has seen short interest shrink from 12.16% in July to 5.36%, with Kuvari Partners, BlackRock Investment Management and TT International all reducing their short positions between November and December last year.
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