Morning Brief – 22-Nov-2018

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Morning Brief Images 22-Nov-2018

UK Stock Market News Today – 22-Nov-2018

Morning all!

CMC Markets (CMCX) – 118.6p – £342.8m – PER 9.97

Results For The 6 Months To End September 2018 – Income down -21%, PBT down -76% and EPS down -69% on an increase in trades (14%) and a reduction in active clients of 4% – Even Revenue per active client is down -22%.

Still too much uncertainty here and the fall in Revenue per active client is not encouraging at all – I’m still Neutral.

Hornby (HRN) – 32.5p – £40.7m – PER n/a

Results For The 6 Months To End September 2018 – Revenue down from £17m to £13.8m, Statutory Loss Before Tax of -£3.2m (-£5.7m last time), Net Debt is £1.8m (£4.7m last time). Frugality and bonuses are the name of the game here now “a one-off 5% bonus (to all employees) given for getting to break even and c.15% of operating profit shared between (all) employees thereafter.”

I still don’t feel any more comfort here – I remain Neutral.

Keller Group (KLR) – 622p – £448.2m – PER 6.26

Trading Update – H2 continues in-line with the Board’s expectations – Re-iterates in 2019 contribution from major projects will be lower than this year.

First coverage for me and I have to say I am not exactly inspired – I will go Neutral and keep an eye out for actual results and perhaps some revised forecasts.

Mothercare (MTC) – 17.56p – £60m – PER n/a

Results For The 28 Week Period To 6th October 2018 – Loos Before Tax of -£6.2m (-£2.6m last time), Net Debt due to an equity raise down from £44.1m to £21.5m. International showing signs of recovery, UK still slowing.

Remains on my Avoid list.

Redcentric (RCN) – 77.5p – £115.6m – PER 13.1

Results For The 6 Months To End September 2018 – Revenue down -7.6%, Loss of -£0.1m (break-even last time). A 0.4p Interim Dividend has been reinstated.

I am Neutral and cannot get excited here at present.

Majestic Wine (WINE) – 374.5p – £270.1m – PER 18.9

Results For The 26 Weeks To 1st October 2018 – Revenue up 5.4% but made a Loss of -£0.2m (£3.1m Profit last time), EPS is also negative (-0.1p) versus positive last time (3.1p). The Interim Dividend is flat.

I really can’t see the investment case here at all – They keep banging on about accelerating Revenue to £500m by 2019 (10% higher than it was in 2017). I thought this was a crazy valuation on a PER of 22.7, at 18.9 I still think it’s crazy. A thought – Are huge bonuses being promised on hitting £500m Revenue in 2019, is that why they’re screwing Profits?

Wynnstay (WYN) – 402.5p – £79.6m – PER 10.7

Trading Update For The 12 Months To End October 2018 – FY PBT an EPS to be ahead of current market forecasts. Outlook remains positive.

Probably some value here, I am Neutral but will keep an eye out for actual results and potential upgrades.

As always, all comment most welcome!

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