Questor share tip: Hyder Consulting offers rapid dividend growth

Questor share tip: Hyder Consulting offers rapid dividend growth

Hyder has achieved this performance by focusing on high growth overseas markets. More than two thirds of Hyder’s revenue comes from engineering work in Asia Pacific and Middle East regions.

The Middle East is going through something of an infrastructure boom as it uses petrodollars to build hospitals, railways and motorways.

Hyder is currently working on the “M25 of the Middle East” referring to the Qatari’s £3bn Doha expressway project, on which Hyder Consulting has recently won a £70m design contract.

In the most recent trading update Hyder said currency weakness in the Australian dollar would hurt full-year forecasts and brokers trimmed back profit expectations.

Investors should focus on the long term story here which is very much intact. The shares trading on a PE ratio of 11.8 times forecast 2014 earnings, falling to 10.7 times next year, are therefore on an unfair discount to sector peer WS Atkins on a PE ratio of 13 times, buy.

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