London equities are struggling to hold on to yesterday’s gains on hopes rises that the European Central Bank is finally preparing for ‘proper’ QE. Click here to see the Trader Nicole Elliott’s latest views.
IC TIP UPDATES:
Royal Dutch Shell (RDSB) has announced a gas discovery in its pre-salt frontier well offshore Gabon. We keep our buy rating.
Mining giant BHP Billiton (BLT) saw production rise by 9 per cent in the three months to September with record levels of output in eight operations and four commodities. This leaves the company on track to meet full year expectations. We retain our buy recommendation.
SuperGroup (SPG) has announced that founder and chief executive Julian Dunkerton is moving sideways to become product and brand director to allow non-executive Euan Sutherland to become chief executive. Mr Sutherland was previously chief executive of Co-op and Kingfisher UK. Our recommendation is under review.
Home Retail Group’s (HOME) recent trading has remained strong with half year sales up by 3 per cent to £2.7bn with Argos like for like sales 2.9 per cent higher and Homebase like for likes up 4.1 per cent. Reported profits dipped by 5 per cent due to investment in the business but ‘benchmark’ profits rose 13 per cent. Internet sales at Argos are now up to 43 per cent of total sales. Buy.
Pubs group Spirit (SPRT), which has agreed a takeover offer from Greene King (GNK) has posted full year results showing a 4 per cent rise in earnings on a 52 week basis and pre-tax profits 8 per cent higher at £60m.
Online CFD provider Plus500 (PLUS) continues to grow apace with third quarter revenues almost trebling to $56.2m following high-teens percentage growth in new customers and active customers and a 138 per cent rise in average revenue per customer. Revenue for the first nine months of the year has already surpassed that for the whole of 2013 by 41 per cent and management expects full year results to exceed current expectations. We keep our buy rating.
Aerospace and automotive components specialist Senior (SNR) says profits for recent months are in line with expectations. Buy.
Cohort (CHRT) has won a £23m contract to provide its External Communications System to the Royal Navy’s entire submarine fleet. We maintain our buy recommendation.
International Personal Finance (IPF) has reported underlying profit growth of 21 per cent in the third quarter due to strong business conditions for personal lending in most of the diverse markets it serves although currency movements affected reported figures and its Czech-Slovakia operations were hit by weaker demand. Buy.
Recently floated retailer Shoezone (SHOE) says revenues for its year to 4 October are expected to be £172.5m, down from £193.9m last year, although this was expected. Pre-tax profits are expected to be in line with forecasts and its net cash position will be well ahead at £8.5m. We maintain our buy rating.
Development Securities (DSC) has posted half year profits of £18m, up from £8.1m last year with its net asset value rising 4.7 per cent to £335.5m during the year. The company completed 11 disposals worth £127.2m and 11 acquisitions for £179.4m during the year. Buy.
Urban & Civic (UANC) has received planning permission for a Sainsbury superstore and adjacent industrial park in Herne Bay, Kent. We keep our buy.
KEY STORIES:
British American Tobacco (BATS) saw revenues for the nine months to September fall by 9.6 per cent in actual currency terms with cigarette volumes down by 1 per cent to 495 billion. The company’s core global drive brands grew volumes by 6.2 per cent.
Gambling software specialist Playtech (PTEC) has seen its performance accelerate in the third quarter of the year, resulting in record quarterly results during which total revenues grew by 28.6 per cent.
UBM (UBM) says that performance remains in line with expectations, notwithstanding adverse currency movements.
