Galliford Try showcased as an “Extraordinary business” on a low valuation (LON:GFRD)

Galliford Try plc (LON:GFRD) is discussed in an exclusive interview with Co-Fund Manager Gervais Williams of The Diverse Income Trust plc.

In this excerpt from the full interview, DirectorsTalk asks: Both the government and Labour have made investment in the UK’s critical infrastructure, energy, transport, technology a real priority. Galliford Try Holdings plc (LON:GFRD) is doing exceedingly well financially with a high quality order book. It seems whatever the outcome of any future election, Galliford Try is in a real sweet spot. Is that future growth reflected in their share price?

Gervais Williams commented: Yes, it’s interesting, really. As you move down the market cap range – Galliford Try is about £250 million market cap, Hercules Site Services is also in the construction section and only a £22 million market cap company, so that’s a micro-cap company – the valuations get more and more attractive. 

Here’s a company, Galliford Try, which has got a very substantial cash balance on its balance sheet, it has other assets in its balance sheet, which are relatively liquid as well. So, the business itself is actually almost extraordinary, a business which is very substantial in its own market, it’s got a major order book, it does about £1.5 billion of sales every year. For a £250 million company, that’s amazing.

Hercules Site Services, again, they’re going pretty well. They’ve got strong momentum, they particularly talk about the highways, the energy, and the opportunities in the water markets, which again, are very long term.

So, these are both companies which have relatively long service industries with relatively long order books, which are standing on valuations which are low in comparison to the UK, which is low in comparison to international markets. These kinds of opportunities are really terrific opportunities long-term to generate some very, very attractive returns for investors.

Galliford Try plc is one of the UK’s leading construction groups, working to improve the UK’s built environment and delivering lasting change.