Buy signal on EXEL Industries (EXE-FR)
Exel Industries is a €373 Mn market cap which specializes in spraying equipment for the agricultural, industrial (transport, metallurgy and the wood and plastics industries) and general public markets. Revenues are split betwen plant protection (75%; No. 1 worldwide). The products used for spraying are plant-care substances (herbicides, insecticides, fungicides, fertilizers, etc.); and materials protection (25%; No. 3 worldwide). The group sells industrial equipment for applying paints and thickened products (pumps, manual and automatic spray guns, etc.) as well as dust-removal solutions (especially for mines and quarries).
For the full financial year ended September 30, 2020, Exel posted revenue of €754.4 mn, down €22.3 mn (-2.9%) compared with 2019. At CER, it was down by €48.4 mn (-6.2%). Although the first half was down by 10%, the second half was up by 3% and the Q4 was up by 13%.
The stong momentum in Q4 bodes well for a swift recovery in 2021 and acceleration in 2022 with expectations of record net profits above €30mn. The garden-watering sector which is averaging 4% annual growth is now a major asset and has benefited from the upsurge in enthusiasm of locked-down households and a creditable rate of service considering the very high business levels of the last quarter.
Short term catalyst: Strong momentum in garden watering.
This signal looks consistent with the Major Bullish Trend in European Industrials.