Companies: AXN    HYC   

Support services analyst Francesca Raleigh has nudged up her 2009 numbers for corporate client Hyder Consulting following a £6.7 million acquisition in Germany and notes scope for further upgrades.

Engineering and design consultant Hyder has acquired water and transport consultant Voigt for £4.7 million in cash and £900,000 in shares, with £1.1 million of deferred payment linked to performance. That is in line with its strategic push to increase scale and margins in the German market.

Following the deal, Raleigh has a buy stance and 589p target price on the £175 million group (currently 476.5p). March 2008 forecasts are left unchanged at £13.8 million of profit and 31.6p of earnings. For March 2009, earnings are upgraded from 36.3p to 37p (from profits of £16.7 million), while the group’s strategy is to raise margins and make potential bolt-on acquisitions. She also highlights buoyant conditions in the Middle East.

Alexon wearing thin
In contrast, small-cap ladieswear and menswear retailer Alexon, a one-time buy, suffered downgrades due to tougher trading in the retail sector and concerns about its bias towards department store concessions. ‘With Debenhams struggling and House of Fraser moving its offering to edgier and better-performing brands,’ writes Numis, ‘we fear Alexon could well come under greater scrutiny and possibly even lose some contracts if these brands underperform.’ Current year profits are downgraded by 7.6 per cent to £14.5 million, with the 2009 profit estimate culled to £14 million (£15.3 million). Setting a 111p target for the 118.75p shares, Numis urges clients to reduce their exposure.