Ricardo PLC (RDCO)

[WickedLester]

Is this share worth watching for those that are looking for green investments?

They've struggled a bit the last couple of years but have an Energy & Environmental business which is already making good profits and in the latest trading update they say:

https://www.investegate.co.uk/ricardo-p ... 00067432Z/

· Strong growth in Energy & Environment ('EE'), with an acceleration in climate related work, supporting international organisations and governments in the lead up to and then following COP26. This includes a heightened focus on environmental, social and corporate governance ('ESG') from private sector clients which are seeking support and advice in respect to Net Zero strategy development, target setting, monitoring and reporting.

I think they may also sell their legacy Automotive and Industrial business as they say:

Ricardo plans to announce its half-year results on 24 February 2022. As well as reporting on the half year business performance, we will cover the Group's objectives and the future direction of our Automotive & Industrial business unit.

At the end of the trading statement they say:

Our strategy is to refocus the Group on the growing mega-trends within our core markets including climate change, energy transition and rapid urbanisation, which will support long-term sustainability and value for all stakeholders.

At the moment they don't look bad value to me with a market cap of around £280m, a pretty good balance sheet with manageable debt and last year they made an underlying pbt of £18m.

The price fell a long way in 2020 and has yet to recover so if they can achieve growth in these emerging areas as well as divest some old economy businesses they may well have some decent upside.

https://www.investegate.co.uk/ricardo-p ... 00047740L/

I currently have no position but am keeping a close eye on them.

Anyone have a view?

[WickedLester]

The price of these has fallen a long way recently and they may now present a good buying opportunity.

I have bought some shares.

[GrahamPlatt]

Thanks for the heads-up. Very severe dividend cut in 2020, it has a bit of an issue with gearing and intangibles, but otherwise it ticks a lot of boxes. Looks likely to be a good entry point. All the best with it.

[WickedLester]

This is one that didn't have too bad a year, not just from a share price perspective but also there was a lack of profit warnings!.

I still don't think they're overpriced although the dividend yield is modest and they may struggle to rise from here with better returns available on cash at the moment.

These could be a takeover target as some point.

[scottnsilky]

I sincerely hope they won't be a takeover target, from a purely selfish point of view! I've known about this company for several decades and their reputation in their field is second to none, they are the bee's knees of internal combustion engine technology, but as they say, they may well divest themselves of this old-fashioned part of the business.

As a (sort of ex-) automotive engineer, and car nut in the past, I would love to have their name in my portfolio, but I need a decent dividend yield for my retirement, and this company doesn't pay enough.

Good luck with your investment WL.