News Column

Aggreko shares up 2% after analyst backing

June 7, 2014

greig cameron; greig cameron

AGGREKO has seen its shares edge up almost two per cent following a positive update from an analyst.

For a period yesterday the stock was three per cent up and head of the FTSE riser's board but it fell back to close the day up 31p at 1687p. That came as Jefferies International re-iterated its buy rating on the stock citing "a range of opportunities" the business has.

The Glasgow-based temporary power supplier hosted an analyst visit earlier this week to discuss its operations across the Americas.

Jefferies said it felt there was a high degree of confidence in Aggreko's local arm and pointed out it is the sixth largest rental business in North America.

The power projects division believes a project in Panama, where Aggreko represents more than six per cent on the grid, could be replicated in other parts of Latin America while there are further industrial opportunities in the region as well as into Brazil.

Jefferies also indicated Aggreko is looking into new niche markets and said: "We saw interesting examples in cooling, remote monitoring, loadbank testing, microgrids, power projects (direct to market and direct to industry) and mini-projects."

The analysts believe Aggreko can increase its support position for the US shale gas industry while also growing its temperature control business into developing economies in Latin America, Asia and Africa.

Jefferies added that it saw potential for the company to develop a winter ice rink business as there is in Europe. They added: "The dynamics here are slightly different as margins are very attractive."


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Source: Herald, The (Scotland)


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