AWF plays down price spike query after shares jump to highest level in 3 1/2 years
AWF Madison Group, the country's largest contract labour firm, played down an inquiry into a recent share price spike that's seen the stock trade near a three-and-a-half year high.
NZX Regulation sought an explanation over a 13 percent gain in the share price between April 3 and April 24, to which AWF company secretary David Lazarus responded that the company remained within continuous disclosure obligations. AWF last posted a price-sensitive announcement to the NZX on Nov. 2 when it declared its $15.3 million acquisition of Absolute IT recruitment firm unconditional.
The shares have climbed 24 percent since that Nov. 2 announcement to trade at their highest level since July 2013. The stock is trading at a price-to-earnings multiple of 17.02 times, compared to P/E multiple of 15.52 times for the S&P/NZX All Index, according to Reuters data.
AWF set "modest goals" for the year ended March 31, 2017, with a goal of bouncing back from a dip in earnings in 2016 when it bore a $1.3 million restructuring bill. It lifted first-half profit 15 percent to $3.9 million as a tight labour market stoked demand for its contract services and expected that dynamic to continue through the second half of the year to deliver "double-digit earnings growth for the full year".
Companies with March and September balance dates are set to report earnings from next week.