Analysis of Saint-Gobain share price for trading


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Maybe you are interested in enlarging your online stock market investment portfolio to include large French companies that are included in prestigious indices such as the CAC 40. In this case the Saint-Gobain Company, a specialist in construction materials, may already be known to you. But before launching into speculation of this highly successful company shares we recommend you learn more details about its activities and some important information that will enable you to make an effective analysis of its share price.

 

About the Saint-Gobain Company:

As stated above, Saint-Gobain is one of the leaders in the manufacture and sales of construction materials on an international level. Its activity takes place mainly in Europe but also touches other countries and areas worldwide.

The majority of this company’s turnover is generated by the distribution of materials through a large distribution network. Then there is also the manufacture of construction materials, glazing, high performance materials and treatments.

 

Details of the activities and products sold by the Saint-Gobain Company:

Nowadays, the activities of the Saint-Gobain Company are divided among various activity sectors of which here are the details:

  • The distribution of materials represents 49% of the group’s activity with over 4,200 sales points throughout the world under the following brand names; Point P, Lapeyre, Jewson, Graham, Raab Karcher, Dahl, ‘La Platforme de Batiment’, and Orientale.
  • Construction products represent 27.5% of the company’s activity with plaster, insulation, industrial mortars and tubing.
  • To conclude, innovative materials represent 23.5% of the group’s activity with high performance materials and glazing.

Let us now look at the geographic details of the turnover achieved by the Saint-Gobain Company. 27% of its turnover was achieved in France, 42% in Western Europe, 12% in North America and 19% in emerging countries and Asia.

 

The major competitors of Saint-Gobain:

The Saint-Gobain group is currently the international leader in its sector due to a scaled economic strategy that was implemented long ago. But the group has also been accused of illicit relationships with several of its competitors and in consequence has had to pay a fine of 1.38 billion Euros. Nowadays, there is no more talk of collaborating with its competitors and Saint-Gobain needs to battle with the few businesses that try to wrest market parts from its grip. We offer you the opportunity here to learn about the companies that threaten this business as you should take their events and news into consideration when completing your fundamental analysis of this stock market asset.

  • Wolseley
  • Lapeyre
  • Berisford plc International
  • Boral Ldt
  • Groupe Castorama Dubois

On the other hand it should be noted that a new form of competition is now making its appearance in China which could also present a threat for the group in coming years with far more competitive prices.

 

The major partners of Saint-Gobain:

The Saint-Gobain Company spends a large amount of money on research and innovation and therefore needs to implement numerous alliances and strategic partnerships with other companies to lower its production costs and fees. A number of large French companies are therefore current partners of Saint-Gobain.

This is the case with the company Point-S to which Saint-Gobain entrusted the maintenance of its fleet of vehicles which comprises several tens of thousands.

More recently, in 2017, the Saint-Gobain Group entrusted its communications to the French Group Publicis after an invitation for tenders.

Finally, on the international level, Saint-Gobain has signed a strategic partnership in Egypt with Sisecam for the construction of a factory to produce 900 tons of glass every day for the unique destination of the Egyptian market.

 

Analysis of the Saint-Gobain share price:

Although the turnover of the Saint-Gobain Company has shown a certain stability over recent years, online investors that wish to integrate this company in their portfolio may equally find it profitable to speculate in their shares over the short term.

 

Important stock market information about Saint-Gobain shares:

It is of course extremely important to know the different economic and stock market events that have marked the growth in the Saint-Gobain share price and its issuing company. But it is also essential to be aware of other more general details about the quotation of this asset. This is why we decided to list here some essential data that you should remember about this stock market asset and its possibilities. 

  • In 2017 the total stock market capital of the Saint-Gobain Company is around €25,715.09 million.
  • At the same time, the number of shares issued by the company and in circulation on the stock markets comes to a total of 555,281,510 shares.
  • The price of Saint-Gobain shares is currently quoted in the section A of the Euronext Paris stock market in France.
  • Saint-Gobain Company shares are also included in the composition of the CAC 40, the National French share market index, this places Saint-Gobain among the top 40 French companies in terms of stock market capital.
  • Shareholdings in the Saint-Gobain Company are composed as follows: 80.60% floating, 7.70% Savings Account funds, 6.40% Wendel, 5.08% BlackRock and 0.20% Autocontrol.

 

Financial and economical history of the Saint-Gobain Company:

A study of the economic and financial events that have marked the history of the Saint-Gobain Company over the last few years enables us to better understand the movement trends of its share price on the stock markets. Therefore, to enable you to use this data, here is a summary of the most significant events:

In 2014, Saint-Gobain sold its activities in North America for 1.5 billion Euros to the Ardagh Group. In June of the same year, the group announced its purchase of the Phoenix Coating Resources, a ceramics manufacturer for the aeronautical industry. Also in 2014, Saint-Gobain took control of Sika, a Swiss company specialised in chemical products used by the construction industry.

In 2015 Saint-Gobain sold its subsidiary Verallia to the Apollo Global Management investment fund for 2.95 billion Euros. The subsidiaries of Apollo Global Management and BPI France held 90% and 10% of the shares of Verallia respectively. In July of the same year Saint-Gobain purchased 49% of the remaining shares of Cipta Mortar Utama, a company specialised in mortar.

Again in 2015 Saint-Gobain organised a temporary exhibition and world tour to celebrate its 350 year anniversary.

In 2016 Saint-Gobain announced the purchase of E-Mix, another company specialised in mortar, for 104 million Euros. In December of the same year, it purchased 100% of the capital of the Romanian company Pietta Glass Working, a specialist in glass transformation.

 

How to use all this information to effectively trade in Saint-Gobain shares?

All the data that we have given on this page can be useful to you when completing full and effective analyses on the Saint-Gobain share price. The details of the group activities will help you better understand the activity sectors you will need to monitor.

The analysis of past events and their effect on the price of this asset can equally assist you in using the data from a technical analysis in order to anticipate major future movements of this share price.

Of course, it is also important to take into account the data provided by a technical analysis. To do this correctly it is best to use reliable technical indicators to analyse the market trends. Finally, we highly recommend that you favour a strategy based on the collection of data provided by a fundamental analysis and that supplied by a technical analysis.

CFDs enable you to trade on the rise and on the fall of the Saint Gobain share price. In fact, these contracts enable you to take a buying or selling position on the relevant stock market assets. It is therefore possible to speculate on these assets whatever the market conditions.

 

Saint Gobain and research and development:

Saint Gobain not only produces and sells its products and services but also invests in the research and development of this sector of activity.

The company has four research and development centers and 14 research centers, as well as about 100 development units around the world, bringing together 3500 researchers. In fact, Saint Gobain has gradually set up a network of university collaborations with the university of Harvard, The State University of Moscow, the Polytechnical School of Lausanne, the ESPCI Paris tech and the Indian Institute of Technologies of Madras to support its program of research and further innovate in this sector.

Thanks to the implementation of this research and development strategy, Saint Gobain positioned itself in the ranking of the 100 most innovative organizations in the world in 2015 and for the fifth time in a row. This ranking is stablished every year by Thomas Reuters and its track record is done based on the quantity of patents proposed, the number of patents accepted compared to the patents deposited and their international importance as well as their notoriety.

 

The cases that have harmed Saint Gobain

Saint Gobain had some problems with the law in the past which have strongly affected its notoriety and on the price of its shares.

In 2008, the company was sentenced by the European commission to pay a fine of 896 million Euros for an illegal agreement on glass prices for the automobile industry between 1998 and 2003, with three of its main competitors and in violation of the competition rules of the European treaties in force. The fine was then increased by 60% for recidivism since the company had already been sentenced twice by this commission, in 1984 and in 1988.

 

The advantages of Saint Gobain’s shares as a stock market asset:

Saint Gobain shares are currently one of the most popular French stock market assets traded by investors that have a portfolio of securities or investing through CFD’s. However, this success is not by chance since the company has many advantages that favorizes the trading of its title and about which we will talk more in detail here;

One of the biggest advantages of Saint Gobain is currently its position as number one in housing. The group which was created in 1665 benefits from long experience which has enable it to strongly diversify its activities over time. Today, Saint Gobain has reorganized its activities into 4 complementary divisions, mainly with the distribution which represents more than 47% of the company’s sales, construction products represent 31% of the company’s sales, innovating materials and flat glass represent 24% of the company’s sales and packaging with the brand Verallia.

Saint Gobain is currently benefiting of the strong climate issues that are particularly affecting the sector of construction with the need to reorganize the market around energy efficient constructions. Saint Gobain is particularly well positioned in this sector thanks to its constant innovations in improving energy efficient constructions. This specificity represents in fact more than 32% of the sales made by the company mostly in France.

Even if Saint Gobain is currently the leader in its sector of activity in France, it also counts with an excellent positioning on the international market. Its market shares abroad have indeed been increasing since some years now. The company does around 26% of its activity on the French market, 43% in the rest of Western Europe and 15% in emerging countries and North America, the internationalization of the company’s activities has accelerated since 2016

Regarding the opportunities to seize by Saint Gobain’s in the near future, we can notice that the company has put in place a strategy primarily based on a priority of products and solutions with significant added value. The latter should indeed increase of 53% of sales for the year 2018 compared to only 24% in 2013. To achieve this goal, Saint-Gobain counts with the creation of various partnerships with targeted start-ups.

Saint Gobain’s desire to maintain a local implantation of its distribution units, which offer real advantages in terms of competitiveness compared to its competitors outside Europe. In fact, Saint-Gobain remains very competitive in exporting thanks to the recent loss of points of the Euro against the dollars which facilitates sales in the United States.

Finally, investors are also reassured by the fact that Saint-Gobain has managed to find a healthy financial situation, which allows it to buy,back its shares.

Finally, Saint Gobain stocks show real advantages for investors who are seeking for a solid security to speculate on. The strengths of this company with long experience are no longer present and the opportunities for the future are real, which suggest a rather optimistic perspective for the months and years to come.

 

What are the disadvantages of Saint Gobain shares as a stock market asset?

Saint Gobain shares remain a favorite choice for investors that want to speculate on the French stock market. But if the advantages of this security are undeniable and numerous, you must also take into account some weaknesses that may represent a threat for the future of the company. Here are therefore the weaknesses that you should know about this asset.

Saint Gobain’s main weakness concerns the cyclical aspect of its activity. In fact,the majority of the company’s sales are in the construction market, its growth prospects are therefore closely related to those of the real state sector which as we know is particularly unstable.

Saint Gobain securities could also be impacted by recent news since the takeover of Sika is currently lagging. Let’s remember that in 2015, Saint Gobain bought 16.1% of the company’s capital from the family holding company and 52.4% of its voting rights. The opposition of some of the directors of the Swiss company in 2016 has made Saint Gobain loose valuable time and they are still suffering the consequences.

The current period is not conducive to significant growth in the sector of activities of saint Gobain. In fact, its results in France disappointed the investors in 2016 with a decline in sales in France, which represent almost 25% of the company’s sales. The results obtained in the United States showed a decline too, even if less important and unfortunately these losses are not compensated by its results in the rest of the world which seem stable.  A warning on the results launched by the end of 2015 scared the investors and made Saint Gobain shares lose some points on the stock market.

Despite these few weaknesses and risks that you should consider in your strategies, Saint-Gobain seems to have all the necessary capabilities to get back on track. The question that remains is whether the elements on which it depends will evolve in its favor in the medium and long term.

 

Some tips for your fundamental analysis of Saint Gobain shares?

If you want to take a position on the course of Saint Gobain shares in the near future, we advise you to follow the technical indicators from the stock charts, and to set up a coherent and precise fundamental analysis. For that, here are some elements that you should follow with a lot of attention and incorporate in your fundamental analysis of this security.

Investors will pay special attention to the evolution of housing starts and construction permits in Europe over the coming years which will predetermine the level of sales that Saint Gobain is likely to achieve.

You should also monitor closely the achievements or non-achievements of the expected results since the implementation of the strategy in 2014-2018. By the end of 2018, this strategy foresaw a shift of 66% of the industrial shares outside Western Europe and mainly in North America, Asia and Africa in order to minimize the cost of production and transportation of products to these commercial targets. Saint Gobain also relies on a significant rotation of its portfolio which also remains to be verified even if this objective seems largely achieved according to the latest results. Finally, the company was also expecting significant external growth with targets of more than 4 billion Euros already identified. It goes without saying that the achievement of these objectives would represent a real springboard for Saint-Gobain shares, just as its non-achievement could be a major setback for investors.

The company’s ability to reduce its production costs in order to gain competitiveness must also be closely monitored. The program of cost reduction implemented by Saint Gobain is expected to save nearly 800 billion dollars by the end of 2018 and thus achieve a net improvement in operating income.

Finally, it is essential to keep an eye on what is going on with emerging markets with the possible arrival low-priced competitors coming from Asia, whose competitiveness would be a challenge for Saint Gobain.

With all these elements, you will have a very reliable overview of Saint Gobain ability to manage its profitability and will therefore be able to implement strategies of investment using fundamental data such as technical analysis. We also advise you to prioritize day trading using CFD’s because of the significant volatility of this title.

Where and how to trade on Saint-Gobain shares price?

Now, It is possible to trade on Saint-Gobain stock price online, you only have to register with an authorized broker and take up or down positions according to your analysis.