British takeover target

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Alexandre Rotenberg /

John Menzies plc: British takeover target

13 August 2019

What readers said about this report

Connoisseurs of bid targets will like this report. It contains a wealth of background information about the ground handling industry, i.e. the industry that John Menzies plc is operating in. If you like investment cases that are backed up by lots of industry data, now is your opportunity to geek out.

Summarising the scenario

Among the areas covered by this report are:

  • Comparable transaction in this space over the past ten years, including difficult-to-find information.
  • Critical evaluation of the company's current cash flow projections and why these will likely form the basis for any valuation in a bid scenario, and based on what range of multiples.
  • Detailed analysis of the shareholder roster, which plays a crucial role in why this company is likely going to be sold.

A niche opportunity for a potential quick profit usually looks at companies with a market cap of at least USD 1bn or USD 2bn. John Menzies plc is significantly smaller than that, and it is not a long-term investment either. I'd very much like to see shareholders bought out soon, rather than hold the stock for an extended period. As such, it's not the typical kind of company to be covered by me.

However, it was too good an investment case not to run past my readers. The stock could go up 75% (or even more) once a bid is launched. Its downside is limited. I like situations where investors can enjoy significant upside without having to accept much of a downside.

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|  What readers said about this report

Giovanni U.
February 2021

Already put my money where YOUR mouth was, really like the investment thesis in (company name hidden by and Menzies, amongst others.

Aaron W.
January 2021

And thanks again for all your great investigative-style analyses. I've been riding with you on Menzies and Gazprom too – I missed the first Gazprom window (though that's how I found you) but bought a bit in early Q4. I also took a small Menzies stake in 2019, then your insights and corroboration on it through the crisis helped me meaningfully increase the position near the lows last year. So thank you!!

Andreas F.
September 2020

A brief question about your report on Menzies, which by the way I found very interesting and detailed (it was my first report from you that I've read).

J. W.
March 2020

Thank you for your valuable insight into company's and their growth prospects. I really like it when I see one of your emails in my inbox! Ive bought into Menzies/Just eat/Twitter/IAG on your research – and I don't think I would have done that on my own.

Robert V. B.
November 2019

BTW, Menzies is my biggest portfolio position by now and I personally think clearly one of your best reports so far.

Arnis D.
October 2019

While not really a value investment, I like your thesis about Menzies and am considering to buy some of their shares.

Roger N.
September 2019

I liked you piece on John Menzies.

l  Report updates

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2 March 2022

Report Update (PDF - 0.2MB)

9 February 2022

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6 September 2021

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30 August 2021

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13 May 2021

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10 March 2021

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15 January 2021

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2 December 2020

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15 September 2020

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22 June 2020

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27 May 2020

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1 May 2020

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30 March 2020

Report Update (PDF - 0.4MB)

17 January 2020

Report Update (PDF - 0.9MB)

26 November 2019

Report Update (PDF - 0.6MB)

25 September 2019

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