Is it really true that Kone doesn’t have its own thread yet…?!" Well, now it does. It is, after all, Finland’s most valuable company.
I hadn’t prepared for Kone’s earnings day at all, but apparently Kone’s outlook for 2020 is clearly weaker than market expectations, as the share price reaction to the 2019 financial statement release is sharply negative (–2.5%). Fewer new orders than expected. Uncertainty from the coronavirus and Thyssenkrupp?
A dividend per share of 1.70 euros is coming, just under 3%. Last year’s dividend was 1.65 euros.
I couldn’t find a KONE thread either. A company with no net debt riding on a megatrend, which can be seen to have a strong position still in 20 years. The valuation is challenging, PE >30, but quality often costs and it will be very interesting to see how development continues, e.g. through acquisitions.
Yep. I have some connection to Kone’s strategy work during Alahuhta’s time. It was very impressive back then, and it’s been a good foundation to build upon.
I believe the uncertainty related to the Thyssenkrupp situation is one factor in the nervousness surrounding Kone. It seems clear that the financing arrangements for a potential deal are resolved and in order, but otherwise, there are many question marks and risks. I am still under the impression and hope that Thyssenkrupp’s choice will not fall on Kone.
According to news agency information, Kone, having teamed up with CVC Capital Partners, would be offering approximately 17 billion euros this week. This would be at least a billion more than competing offers. Thyssenkrupp may also push for a higher bid.
According to Bloomberg, Kone would be giving Thyssen the option of a cash transaction or a combination of cash and shares. In addition, there would reportedly be some promises regarding competition risks and advance payments.
The price for the share is high right now. It will be interesting to see what levels the price settles at tomorrow if trading continues. It’s a bit tempting to place some buy orders
Kone, which has teamed up with CVC Capital Partners, offered around 17 billion euros ($18.7 billion) this week, said the people, who asked not to be identified because discussions are private.
A fresh stock exchange release states that KONE has made a non-binding offer. The release does not mention CVC or any other partner at all.
The offer price is fairly close to the estimates presented in the media. The offer is based on certain assumptions about thyssenkrupp’s elevator business, and the terms of a possible binding offer may differ from the current non-binding offer.
My small human mind can no longer comprehend this level of valuation. There’s a lot of positive assumption in the market regarding the Thyssen deal, as the price is rising even though, by all logic, its success is already fully priced into the stock. And especially since the deal/purchase price isn’t even certain, and there’s no visibility into the contract terms.
This might be a bit of a bitter shout-out, as I sold my shares already around 50e. But now I might still have to take a small short position.
Yes, it’s worth considering the scenario where the deal doesn’t go through. If the deal is priced in, how much will the stock price drop?
I was also considering a short if it tries to rise to 62.28, making a double top, but doesn’t break above it.
KONE’s share price, like Orion’s in its time, has long been at odds with the consensus of analysts, but now the difference between the share price and target prices has widened to a historically large extent.
All the papers are full of the same superficial fluff, opinions without deeper analysis. Complex entities like these are so difficult, especially for outsiders, that we’ll probably just have to wait for hindsight if no information leaks from the negotiations.
But now I might still have to take a small short position.
