UK250

UK 250 equity research

Explore the most viewed and latest equity research and media content for the next 250 largest listed companies in the UK.

UK 250 Equity Research

Broker research, valuations, & analysis on the UK 250

16 Jul 19

Facebook to use Libra to become utility, Slack not worried about Microsoft, Symantec ends talks with Broadcom

The Senate Banking Committee on Monday released the testimony of David Marcus, the head of Facebook's cryptocurrency projects ahead of his testimony Tuesday. In his prepared remarks, Marcus perfectly outlines the business model behind the social network’s upcoming Libra digital currency and its Calibra digital wallet. Microsoft might be the primary competitor for Slack, but the widespread adoption of Microsoft's software is not a major problem for Stewart Butterfield, co-founder and CEO of the messaging app. Last week, Microsoft said Teams had more daily active users than Slack. Cybersecurity company Symantec Corp has walked away from negotiations to sell itself to chipmaker Broadcom over price disagreements, people familiar with the matter said on Monday. Symantec's decision raises new questions over the future of the US antivirus software provider, which is looking for a new CEO and has been struggling to grow its business serving companies.

Companies: KAPE AVST CNS DFX ECSC FLX IGP NCC OSI SWG SOPH

05 Jul 19

UK Housebuilding Sector in 2Q 2019

Dwight Barkley PhD is a Professor of Mathematics at the University of Warwick. He studies waves in excitable media such as the Belousov-Zhabotinsky reaction, heart tissue and neurons. In 1997, Dr Barkley and Dr Laurette Tuckerman, a Paris-based mathematical physicist, developed ‘bifurcation analysis for time steppers’, which is a technique for modifying computer codes to perform bifurcation analysis. More lyrical, perhaps, Dwight is also known for formulating an equation to estimate how long it will be until a child in a car asks the question “are we there yet?” And, it is shown on the image on page 3 of this report. Herein, there are three factors which decide the timing of this wearisome question i.e. one plus the number of activities, divided by the number of children in the car squared. That figure is then added to the time it took the family to get into the car and set off on its journey. Crucial in putting off the first query as to the proximity of the destination are onboard activities for children i.e. no activities equals a question before leaving the driveway. Dr Barkley says: “Mathematics can help answer many of life’s questions”. If only the Brexit journey were that simple. It is not. We are all children now stuck in the back seat; and, maybe, we are still on the driveway with a dearth of on-board activities. Yes, three years on Brexit-resolution-fatigue is making itself felt across the board, including the UK Housebuilding Sector, where the fall in value in 2Q’19 was 7%. Berkeley said something similarin its final results, on 20 June, when it lamented an uncertain operating environment and “a lack of visibility in the political outlook”; and its PBT is expected to fall by a further third this fiscal year. The daily Sector value chart is also lurching from top-left to bottom-right (as is the British Pound versus the Euro). Yes, there were two palpable positives in 2Q from the NHBC and UK Finance about building activity and mortgages; plus, on the third day of 3Q, CBRE’s bid for Telford Homes. Nonetheless, prospective earnings growth for the Sector is now flat in both 2019 and 2020. This is about the journey.

Companies: MCS TW/ PSN BDEV ABBY CSP WJG BVS TEF INL GLV GLE CRST BWY BKG

04 Jul 19

Australian banks to digitize bank guarantees, US Gov reviewing license requests for Huawei, Broadcom to acquire Symantec

Australia's top three banks said on Thursday they have agreed to partner with IBM and shopping mall owner Scentre Group to test blockchain technology to digitize bank guarantees. The companies are exploring how to move away from paper-based bank guarantees to cut processing time and the risk of fraud, Australia and New Zealand Banking Group, Westpac Banking Corp and Commonwealth Bank of Australia said in a statement. The US government said on Wednesday it was reviewing licence requests from US companies seeking to export products to China's Huawei "Under the highest national security scrutiny" since the company is still blacklisted. In an email to Reuters, the Commerce Department said that as it reviewed applications, it was applying the "Presumption of denial" standard associated with Entity Listed companies, meaning applications are unlikely to be approved. Symantec shares surged more than 20% in extended trading on Tuesday after Bloomberg reported that Broadcom is in advanced talks to acquire the security software vendor. The deal is reported to be worth more than $16bn, implying an EV/Sales multiple of 3.40x (Bloomberg). Agreement on a deal was close but could be delayed until after the July 4 holiday, according to people briefed on the move.

Companies: KAPE AVST CNS DFX ECSC FLX IGP NCC OSI SWG SOPH TECH AMO IQE

02 Jul 19

LIBERUM: Sirius Minerals* - Q3 update: Financing coming together, progress at site

In its Q2 progress report Sirius reiterated its expectation for Stage 2 financing to be completed by the end of September. Once the bond offering and RCF documents are complete and the agencies have delivered a public rating, the company will be in a position to push ahead with marketing the bond.

Companies: Sirius Minerals

02 Jul 19

THE MONTHLY July 2019

When advisers first start looking at business relief (BR) products, there is much to take in: the rules governing such products; the investment strategies being used; and what the investment risk is. It is easy to lose sight of the fact that, for non-AIM products, the investment is being made directly into a company or partnership, rather than a fund. It is, therefore, essential that governance is part of the diligence process.

Companies: AVO AJB AGY ARBB CLIG DNL DPP FLTA GTLY KOOV LWRF MCL MUR NSF OXB PCA PHP RE/ REDX RMDL STX SIXH TRX TON SHED VAL VTA W7L

12 Jul 19

Vietnam Enterprise Investments - Executive Interview

Vietnam Enterprise Investmentst (VEIL) was launched in 1995 and is the largest closed-ended fund focused on Vietnam. In July 2017, it became a member of the FTSE 250. VEIL aims to generate long-term capital growth by following a bottom-up approach, unconstrained by the benchmark, to find high-quality companies that are attractively valued. The fund is managed by Dragon Capital, Vietnam’s largest and longest established investment manager. In this webcast, Dominic Scriven, chairman and founder of Dragon Capital, introduces the company and discusses why we should invest in Vietnam, and why now. Dragon’s head of research, Le Anh Tuan, explains VEIL’s investment objective and gives his outlook for Vietnam. He explains the manager’s investment approach and what differentiates it from other managers. He also discusses the portfolio’s current position and recent performance.

Companies: Vietnam Enterprise Investments

17 Jul 19

FLASH: Strong operating update

1H19 production of 84.1 mboe/d was slightly ahead of our expectations of 82.6 mboe/d and ahead of Premier’s budget, given strong production in the UK, particularly at Catcher (99% operating efficiency), Huntington and Elgin Franklin.

Companies: Premier Oil

16 May 19

FLASH: 1Q19 update

Excluding 3.4 mboe/d production from Pakistan, YTD production was 81.7 mboe/d (GMP FEe: 79.8 mboe/d excluding Pakistan). Catcher production has been particularly strong at 34.4 mboe/d and 99% uptime (GMP FEe: 31 mboe/d). Huntington also outperformed our expectations (6.5 mboe/d vs 5.5 mboe/d) given high uptime while Indonesia was a bit below our forecasts (11.8 mboe/d vs 12.5 mboe/d). Reinstating the Balmoral b-2 well will take production from the area to slightly over 2 mbbl/d (net) above our forecasts for FY19 of 1.6 mbbl/d. Net debt at the end of April was US$2.25 bn. FY19 production guidance has been increased from 75 mboe/d to 75-80 mboe/d with capex guidance unchanged at US$340 mm.

Companies: Premier Oil

28 May 19

LIBERUM: NewRiver* - Leveraging expertise to grow income

NewRiver delivered stable profits in FY19, with a valuation decline limited by its diverse portfolio, centred on affordable convenience & community assets. We still expect further retail pressure and lower our forecasts.

Companies: Newriver Reit

05 Jul 19

SIG - Consensus in Detail - HY Trading Update

SIG is actively covered by 14 investment analysts, 13 of whom provide a full set of forecasts for 2019 and 2020. These are anonymised to form the basis of this analysis. The analysis provides detail on forecasts for the following four key financial metrics; PBT, EPS, DPS and Headline Financial Leverage

Companies: SIG

11 Jul 19

LIBERUM: Workspace Group* - Sustained demand and good scheme progression

Sustained good demand for new and existing space through Q1, despite wider uncertainty, provides reassurance in our full year forecasts. Enquiry levels remain robust at ~1,000 per month. LTV remains stable providing the basis for continued progression of the group’s refurbishment and redevelopment schemes, on which good progress was made in Q1.

Companies: Workspace Group

11 Jul 16

Life Science Sector review

And then worst of all, you never get approval when you say you will. There is nothing that causes investor whiplash more than a sudden announcement of an unsuccessful clinical trial. Whether you are the onedrug wonder on AIM or the multi-drug portfolio NASDAQ darling, the market never takes too kindly to unsavoury news from the FDA on clinical results. But should investors lambast these two scenarios similarly based on poor trial results? The variables are endless but in this example the clear answer is no. Investors who invest in one-drug companies edging ever closer to FDA decision day do not have much cause for complaint as they are rolling the dice. But what of the company with many drug candidates in the clinic? Surely the usual knee-jerk reaction of a mass selloff is not rational when a company has a singular failure amongst a well-developed and advanced portfolio?

Companies: AZN BTG CYAD CIR ETX GSK GTCL GWP INDV SHP VER VRP

03 May 18

The Money Bin

In the week to 1 May the FTSE All Share rose 1.2% vs. the Insurance Index at +0.5% and 0.9% for the Lloyd’s Index. The best performer was JLT (+2.5%); Beazley (-0.2%) was the worst performer. The Q1 reporting season has begun: newsflow has been mixed with a number of US insurers reporting improved PBT/rates, but also loss creep, higher Q1 losses and warnings from brokers about stalling rate rises ahead of the key Jun/Jul US renewals. The 2018 hurricane season starts 1 June with consensus for slightly raised activity.

Companies: BEZ HUW HSX JLT LRE

05 Feb 19

THE MONTHLY February 2019

This Investment Research Paper addresses the issue of renewable power generation in the UK and in mainland Europe, which – after the deep-seated financial crisis of 2008/09 and the ensuing recession – now has better prospects of achieving critical mass. It also considers investment perspectives.

Companies: OPM AVO AJB AGY ARBB AVCT DISH BUR CLIG CSH DNL DPP GTLY GDR HAYD KOOV MCL MUR NSF OXB PCA RE/ REDX STX SCE SIXH TRX TON VAL VTA W7L

26 Feb 19

Share & share alike

We have seen a continuation of the rally evident so far this year. The factors are familiar with greater optimism regarding US-China trade talks. At home, the path to Brexit remains unclear as D-day looms. The possibility of a delay has increased. The company reporting season continues to highlight winners and losers with the majority of results in line. We have also seen an uptick in corporate M&A. Results set the morning agenda and Brexit votes the evening one. In Share News & Views we comment on AorTech International*, APC Technology*, DeepMatter*, Golden Ocean Group and P&O Ferries/DP World.

Companies: AOR APC BONH BMS CTG CRPR DMTR ESC EUSP FDM FA/ LSAI NKTN PCF SNX TCN VRE W7L

11 Jun 19

Primary Health Properties to 'continue generating strong returns'

21 May 19

Shaftesbury - Half Year Results 2019 video interview

27 Jun 19

Greene King - Preliminary results video 2018/19

09 May 19

Executive interview - Genesis Emerging Markets Fund

27 Jun 19

Polar Capital Technology Trust (PCT) presentation at Mello Trusts & Funds May 2019

18 Mar 19

Bitesize briefing – Euromoney

09 Jul 18

Genus PLC - Capital Markets day 2018

08 Mar 19

LS Holdings CEO, Fredrik Widlund*

Premium

31 Jan 19

PHP - Full Year Results 2018

06 Mar 19

Vivo Energy plc - Full year 2018 results interview

15 Nov 18

Premier Oil - Zama appraisal progamme

28 Feb 19

Grafton Group - Full year results 2018

22 Aug 18

Grafton Group - Interim Results 2018

11 Feb 19

Acacia Mining - Preliminary results 2018

16 Apr 18

Executive interview - PPHE Hotel Group

Latest Content

Premier Oil

GMP FirstEnergy ― UK Energy morning research package

Equinor (EQNR NO) (not covered): Dry hole in Norway | OKEA (OKEA NO) (not covered) | Premier Oil (PMO LN); BUY, £1.45: Strong operating update | Transaction in Norway

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17 Jul 19
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Premier Oil

FLASH: Strong operating update

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17 Jul 19
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KAPE AVST CNS DFX ECSC FLX IGP NCC OSI SWG SOPH

Facebook to use Libra to become utility, Slack not worried about Microsoft, Symantec ends talks with Broadcom

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16 Jul 19
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Grainger

Update to £34m forward funded acquisition in Leeds

Grainger has announced that construction has now commenced at its 216-home PRS development in Leeds, which is being forward funded for £34m. The scheme (known as Fabrik) is anticipated to generate gross yield on cost in excess of 6.5% once stabilised, with completion anticipated for late 2021. We highlight the fact that this development builds on Grainger’s existing presence in Leeds (complimenting its 242-home Yorkshire Post development, also anticipated to complete in 2021) giving the company significant regional scale, a typical characteristic of Grainger’s acquisition strategy. We leave our forecast unchanged having already accounted for this transaction, and reiterate our Buy recommendation given the attractiveness at current levels (13.5% discount to FY19e NAV, 2.2% yield).

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15 Jul 19
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Vietnam Enterprise Investments

Vietnam Enterprise Investments - Executive Interview

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12 Jul 19
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Workspace Group

LIBERUM: Workspace Group* - Sustained demand and good scheme progression

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11 Jul 19
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Petrotal Cairn Energy

GMP FirstEnergy ― UK Energy morning research package

PetroTal (PTAL LN/TAL CN)1 ; BUY, £0.45: Operating update | Cairn Energy (CNE LN); BUY, £2.80: Dry hole in Norway

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11 Jul 19
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J D Wetherspoon

Decent closure to FY18/19

JDW has ended the year on a strong note. This performance gains further significance considering the strong comparables and a weak show by overall UK-based managed pubs in May 2019 (according to Coffer Peach). We expect top-line momentum to moderate in the subsequent year. The margin pressure is likely to remain in our opinion. No change to stock recommendation.

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10 Jul 19
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Cairn Energy

FLASH: Dry hole in Norway

Well 6508/1-3 encountered about 170 metres of alternating layers of sandstone, claystone and coal in the Åre formation, of which a total of nearly 50 metres of sandstone was of very good reservoir quality. The well was dry. Lynghaug was a 70 mmboe prospect in which Cairn holds 50%.

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10 Jul 19
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JPMorgan Emerging Markets Inv Trust

JPMorgan Emerging Markets - Overview

JPMorgan Emerging Markets (JMG) aims to maximise total returns by investing in emerging market equities with a long-term, low turnover approach. The manager, Austin Forey, focuses on identifying companies with the potential to continue compounding their earnings faster than the market over the course of many years, and then aims to hold onto them through their cyclical ups and downs in valuation and share price performance. The result has been excellent performance in recent years. The trust has been a consistent outperformer in rising and falling markets, beating its benchmark index in NAV total return terms in seven of the past ten years. Over the past five years the trust has comfortably outperformed the index and the peer group, with NAV total returns of 60.4% compared to 40.6% for the benchmark and 41.2% for the Morningstar IT Global Emerging Markets sector. Austin has managed this trust since 1994 and so has vast experience in the region and has refined his approach over that time. His portfolio is concentrated in consumer names, financials and technology, selected on a bottom-up basis rather than for sector or country reasons. Recent purchases have increased the allocation to the growing Chinese domestic economy, which Austin believes have little exposure to the trade war between the US and China and should continue to grow despite that conflict. Although focusing on capital growth, the trust has also generated steady dividend growth and aims to grow its dividend each year in line with earnings; the yield is 1.2%, and the trust has implemented an interim dividend this year for the first time. The trust is trading on a discount of 7.2%. This represents a considerable narrowing since the start of the year and on the five-year average of 11.7%. Discounts on the sector have come in too, from a five-year average of 9.1% to 8.1%, according to Morningstar data. Nonetheless, the board has continued to support the share price with buybacks when the discount has been at or over 8%.