Expert backs Wagner growth despite price drop

TOOWOOMBA’S Wagners Holding Company on Thursday suffered one of its worst single-day performances on the Australian Stock Exchange since it floated 11 months ago.

The share price of the construction materials company, founded and part-owned by brothers John, Denis, Neill and Joe Wagner, dropped by 10.6 per cent on Thursday to $3.78.

This closing value is the lowest price since May 2, when the share price sat at $3.74.

Wagners also saw a significant amount of turnover, with 1.35 million shares traded.

The company held its first annual general meeting in Toowoomba the same day, where it reported meeting profit forecasts from December but advised of a skewing of growth towards the latter part of the financial year.

This was due to “timing slippage” on certain infrastructure projects Wagners was contracted to, with most of them expected to pick up in early 2019.

Dornbusch Partners investment adviser Andrew Wielandt said the company and its investors were still well-positioned financially, considering the initial public offering for shares in December was $2.71.

He put the pullback partially down to the delay of certain infrastructure projects as well as a lack of guidance from the company of financial forecasts.

“They’ve had a golden run to this point,” he said.

“The key takeaway about the share price is investors like to see guidance.

“Guidance provides certainty, but there’s no compulsion for them to provide it and that has been the trend in the industry (not to provide it).

“The other part is the timing of those projects slipping. Those two things in tandem have contributed to the pullback in price.”

Mr Wielandt praised Wagners’ decision to do projects in the United States, adding there were opportunities for growth with civil infrastructure.

He also said the company was sitting pretty considering the volatility of the market.