Pound Oversold Due to External Factors, Repricing of UK Rate Bets
Sterling has fallen deep into oversold territory due to external factors and the market scaling back its expectations for U.K. interest rate rises, ING says. Sterling net short positions, which expect the currency to weaken, reached their highest level since October 2019 in the week to Nov. 30, according to the Commodity Futures Trading Commission. The rise in shorts was "first and foremost" due to a stronger dollar but also reflects risk aversion and some repricing of U.K. rate rise expectations after the Bank of England held rates in November and the Omicron coronavirus variant emerged, ING forex strategist Francesco Pesole says. Another potential factor is post-Brexit trade tension, although this has been a smaller driver, he says.
Fusion Antibodies 1H Pretax Loss Widened, Revenue Rose
Fusion Antibodies PLC said Monday that its pretax loss widened for the first half of fiscal 2022 despite increased revenue, and it expects its full-year revenue to meet expectations.
Cellular Goods Appoints New CEO
Cellular Goods PLC said Monday that it has appointed Anna Chokina as its new chief executive officer.
Thungela Sees 2021 Export Coal Production in Line With Guidance
Thungela Resources Ltd. said Monday that it expects export saleable production of 14.9 million metric tons of coal in 2021, in line with the latest guidance.
Hardide FY 2021 Pretax Loss Widened; Sees Improved Performance in FY 2022
Hardide PLC on Monday reported a widened pretax loss for fiscal 2021 on lower revenue, but said it expects its performance to improve next fiscal year as demand recovers.
Hammerson to Buyback Around GBP2.5 Mln of Shares
Hammerson PLC said Monday that it will start a share repurchase program, rebuying shares worth up to around an implied 2.5 million pounds ($3.3 million).
Apax Global Alpha Funds to Sell Stakes in Unilabs
Apax Global Alpha Ltd. said Monday that two funds that it advises have agreed to sell their stakes in Unilabs to AP Moller Holding, with the transaction expected to close in the first quarter of 2022.
3i Infrastructure Invests GBP191 Mln in SRL Traffic Systems for Majority Stake
3i Infrastructure PLC said Monday that it has invested 191 million pounds ($252.8 million) for a 92% stake in SRL Traffic Systems, a traffic-management rental company in the U.K.
AG Barr Acquires 60% of MOMA Foods, Plans Full Control Within Three Years
AG Barr PLC said Monday that it has taken a 60% equity stake in MOMA Foods Ltd. and plans to take full ownership of the company over the next three years.
Windward Shares Rise on London Debut
Shares in Windward Ltd. rose Monday as the company began trading on the AIM.
Brandshield Reaches $5.0 Mln in Annual Recurring Revenue
BrandShield Systems PLC said Monday that it has suprassed $5.0 million in annual recurring revenue, its primary performance indicator.
Spectra Systems' New Customer K-Cup Optical Material Orders Exceed Expectations
Spectra Systems Corp. said Monday that a new customer has placed three orders totaling $394,000 for K-cup optical materials since September.
Norman Broadbent Raises GBP75,347 From Large Shareholder
Norman Broadbent PLC said Monday that it has raised 75,347 pounds ($99,729) after issuing shares to shareholder Downing LLP.
D4t4 Solutions Launches Share Buyback Program of Up to 200,000 Ordinary Shares
D4t4 Solutions PLC said Monday that it was launching a share buyback program of up to 200,000 ordinary shares, and that it will hold in treasury all ordinary shares purchased so as to satisfy future obligations.
Victrex Recovery May Take Time, Dragging on Shares
1210 GMT - Victrex may take time to make progress despite an upbeat second half, Citigroup says. The plastics group's 2H results topped expectations, helped by modestly improving higher-margin medical sales, the investment bank says. "Looking forward to 2022, management expects growth in volumes, offset by raw materials and energy cost impacts as well as foreign-exchange headwinds," Citi analysts say. "VCT is exiting the trough but the process should take time, constraining the upside for the shares, in our opinion."
Deliveroo Shares Drop Ahead of Expected EU Proposal on Gig-Economy Workers Rights
1205 GMT - Deliveroo faces a potentially significant gross profit hit from the European Commission's looming proposal concerning employment rights for gig-economy workers, Citi says. The proposal--expected Wednesday--could come into effect during the next two years, with individual countries left to interpret it for themselves as the EU's executive arm can't mandate labor laws, Citi notes. The U.S. bank estimates Deliveroo's gross profit will be reduced by 12% to 18% if European gig economy workers are to be treated as employees rather than contractors. Shares in Deliveroo fall 8.6% to 220.6 pence. Shares in Just Eat Takeaway also fall 5.5% to EUR48.26. Delivery Hero trades down 5.2% at EUR97.10.
3i Infrastructure Made a Good Choice With SRL Traffic Investment
1149 GMT - 3i Infrastructure's GBP191 million investment for a 92% stake in SRL Traffic Systems shows its ability to enter and exit assets at the right time, leading to meaningful value creation above fund targets, RBC Capital Markets says. The infrastructure-investment company has chosen a strong fit for its portfolio, with SRL well positioned to benefit from increased infrastructure spending in the U.K., the Canadian bank says. "We expect that the flexibility provided by SRL will be a strong feature for additional customer demand as owning increasingly complex traffic management systems is unlikely to be cost effective," RBC says, retaining its outperform rating on 3i Infrastructure stock and 360-pence price target. Shares are flat at 343 pence.
London Stock Exchange Acquisition of Quantile Should Boost Its Earnings
1143 GMT - London Stock Exchange Group's GBP274 million bolt-on acquisition of Quantile for its post trade division is likely to be earnings enhancing, although there isn't any guidance on the asset's profitability at this stage, RBC Capital Markets says. The stock-exchange and financial-information company's strong cash generation and ability to supplement growth through acquisitions enhances the deal's medium-term appeal, though acquisitions in the data and analytics arena were expected to be more of a priority, RBC says. "We see the enlarged group as transformed, with higher quality revenue streams and enhanced exposure to secular growth themes," the Canadian bank says. RBC retains an outperform rating on the stock, with a price target of 10,300 pence. Shares are up 0.9% at 6,584 pence.
Persimmon Homes Faces Demand Risks From Higher Interest Rates
1129 GMT - Persimmon might face pressure as potentially higher U.K. interest rates weigh on demand from first-time home buyers, Barclays says. The bank cuts its rating on the house builder's stock to underweight from overweight, though it raises Crest Nicholson to overweight from equalweight, and Berkeley Group to equalweight from underweight after share-price weakness. "Following recent house-price inflation, we expect affordability to come under further pressure in 2022 as interest rates and the cost of living rise," Barclays's analysts say. "We see particular demand risks for first-time buyers, where rising rates have a more pronounced impact on mortgage costs. Our analysis shows Persimmon is most exposed."
Shell's Dividend Offers Protection From Inflation
1030 GMT - Shell's forecast dividend yield of 4.4% for 2022 will help to protect investors' cash from the ravages of inflation, and the energy major might top it up with further cash returns via share buybacks, AJ Bell's Russ Mould says. The share price could be volatile as oil and gas prices jump around, but they seem relatively well-underpinned unless a new coronavirus variant leads to a new collapse in economic activity, he says. "This one will not win any friends among those investors who run strict ethical, social and governance screen tests, but oil major Shell may appeal to those income-seekers for whom profit is every bit as important as principle," Mould says.
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