International high-end components and systems manufacturer Senior (SNR) should be a big beneficiary of the stabalisation in commodity markets and a marked step up in US infrastructure spending, while self-help initiatives should also support margins. But the shares' lowly rating still reflects recent troubles rather than the improving outlook, which leaves plenty of recovery potential on offer.
IC TIP:
Buy
at
193p
Tip style
Value
Risk rating
Medium
Timescale
Long Term
Bull points
- Cost management initiatives
- Step up in US infrastructure spending
- Stabilisation in crude oil markets
- Strong aerospace build schedules
Bear points
- Uncertainty on aerospace contracts
- Supply chain issues
The group, established in 1933, operates two divisions: aerospace, which manufactures components and systems for clients in aerospace and defence; and Flexonics, which principally supplies the automotive and energy industries.