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

10 Aug 17

A watershed moment for CAR-T

In the short term we retain our sector neutral recommendation, as drug pricing, uncertainty over healthcare reform in the US, and Brexit in Europe create a more challenging backdrop. However, the long term trends in healthcare – an aging population, rising spending on healthcare globally both in developed and emerging markets and innovation changing healthcare practice – in addition to the rapid pace of technology development, make it an attractive time for stock picking.

Companies: ABC AMS AGY ANCR BTG C4XD CTH CSRT DPH DNL EKF FARN HCM HZD IMM MXCT MTPH PLI SCLP SPHR VLG VER

10 Aug 17

Panmure Morning Note 10-08-2017

1H17 PBT of £78.1m (up 32% YoY) is 9% ahead of consensus forecasts (PG £70.1m) with good underlying trends across the board. Loans grew by 19% YoY to £8.1bn, with NIM broadly stable at 3.48% (consensus 3.47%). Loan origination was up 10% to £1.6bn with £0.8bn pipeline (up 8% YoY) going into 2H17. Costs increased by £7.8m YoY, in line with management’s guidance of £15-20m increase for FY2017. Despite this the cost income ratio fell by 140ppt to 44.1% with the group aiming for <40% in the medium term. Cost of risk was down 6bp to 14bp and now management expect FY2017 CoR to be below 25- 35bp medium term guidance. Group underlying RoE at 18.8% was 240ppt better than our and consensus forecasts. Balance sheet was strong with TNAV increasing by 9.5% HoH to 167p and CET1 ratio of 11.8% (Cf. cons. 11.7%) with management anticipating to deliver above 12% for FY2017 enabling possible dividend payment. Overall these are a solid set of results. We maintain our BUY rating with the stock trading on reported P/TBV of 1.3.

Companies: Aldermore Group

10 Aug 17

N+1 Singer - Hill & Smith Holdings - Positive H1

As indicated in May, trading has been positive in H1 and is in line with expectations. Most areas are trading well and, if anything, a little better than expectations. We retain forecasts but note that as the year progresses, attention will turn to FY18 and the further significant opportunities therein. We nudge our target price up to 1435p and remain at Hold, while remaining very supportive of management and the strategy and the long term potential for the group.

Companies: Hill & Smith

09 Aug 17

Positioning for growth

Rotork is taking decisive steps to determine its future size and shape. The company is not in a holding pattern awaiting a new CEO. Executive chairman Martin Lamb has taken the reins and end-market dynamics are driving a rethink in regards to innovation and the company’s operating footprint. In addition, there is a considerable opportunity to drive aftermarket activity, with the benefits of improved visibility and profitability that should provide. In the short term, management’s FY17 expectations have been maintained with stronger H2 delivery in sight; margins are expected to improve to a similar level to FY16.

Companies: Rotork

11 Aug 17

Growth normalises

Paysafe’s H117 results show that organic constant currency growth is moderating to low double-digit rates, after an exceptional period of growth in 2016. Profitability was strong during the period, helped by the strong growth and margins of the Asia Gateway business. The sale of Asia Gateway and the acquisition of MCPS will both help reduce the group’s exposure to online gambling, and MCPS will strengthen the group’s position in bricks and mortar payment processing.

Companies: Paysafe Group

31 Jul 17

N+1 Singer - Bodycote - Good momentum; PBT forecasts increased

Bodycote reported strong, broadly-based sales growth for H1 17, growth which accelerated within the period. Margin also advanced, leading to a 26% rise in adjusted PBT. Management expects this momentum to continue and increased guidance for the full year towards the top of the range. We have increased our low end PBT forecasts by 14% for 2017 and 15% for 2018 and also increased our target price from 690p to 995p. We believe prospects remain attractive for Bodycote. Industrial data series are supportive across many of its end markets; delivery of the strategy remains strong; and the group has a healthy balance sheet with net cash to support continued investment in organic and/or acquisitive growth. With the shares on a c.25% EV/EBITDA discount to the sector, we retain our Buy recommendation.

Companies: Bodycote

15 Aug 17

Inspiring …

Vectura has a strong and growing revenue stream that generates sufficient cash flow to support a broad development pipeline founded on an extensive base of IP. In our view, share price significantly undervalues the company, currently attributing value to only the marketed products and cash – with the whole of the very extensive development portfolio, both partnered and in house, as upside. We believe the recent weakness in the shares, which have not recovered from the delay in VR315 approval, offers a very attractive entry point for investors. We initiate coverage with a BUY and a 150p target price.

Companies: Vectura Group

27 Apr 17

Panmure Morning Note 27-04-2017

Unchanged outlook for 2017 PBT and Capex. Modest trim to our forecasts

Companies: Aggreko

14 Aug 17

1H17 interims – Now debt free

Clarkson reported underlying EPS of 57.5p, up 9% YoY despite the challenging conditions in the shipping market. The interim dividend was increased by 1p to 23.0p per share and the final tranche of the Platou loan note was paid off. These results were in line with our forecasts, which we leave unchanged. However, now that the balance sheet is debt free and with cash generation at the pace we anticipated, we expect market attention to turn toward the potential for a very material increase in distribution, subject to growth investment, even ahead of a return to more benign market conditions which Clarkson should be fully able to leverage. We reiterate our Buy recommendation and 3,000p per share Target Price.

Companies: Clarkson

15 Aug 17

Exploration setbacks, but shares backed by core

We update our valuation to reflect the Druid and SNE North well results and lower long-term oil price assumption. We look forward to the half-year results on 21 August when Cairn plans to update the market on reserves estimates and the development concept for SNE, which will help to firm up potential value for the field. After adjustments and accounting for our lower long-term oil price assumption, the contingent NAV falls to 196p (from 225p/share).

Companies: Cairn Energy

09 Aug 17

In balance

Greggs’ interims show a company in balance in several ways. First, operational and site development initiatives are driving consistent sales growth despite a challenging market. Second, the balance between low-price value and perceived quality is allowing it to cover peak input cost increases without a serious impact on margins. Third, the financial model is operating to support the dividend with a stable balance sheet.

Companies: Greggs

10 Aug 17

N+1 Singer - Cineworld Group - Blockbuster interims – upgrading back to Buy

An excellent set of interims from Cineworld this morning, encapsulated by a 4% EBITDA beat vs our forecast. Overall, the Group has delivered an impressive 21% uplift in EPS on 18% (12% cc) revenue growth and rewarded investors with a 15.4% DPS hike. The general tenor of the results is positive and whilst there is nothing fundamentally new this morning, we are encouraged by reference to strong July trading. Comps admittedly are stiff for the rest of Q3, but the H1 beat and expectation of a strong Q4 on the back of Star Wars VIII influence us to tweak our FY17 forecast up marginally to take us 2% above consensus. With our new 12m TP of 770p (from 760p) implying 12% TSR we feel there is merit in putting the stock back on the Buy list having tactically downgrade to Hold in May. Overall, in a dull Leisure sector Cineworld continues to be a lone shining star.

Companies: Cineworld Group

18 Jul 17

Cathedral City Drives Strong Start to FY2018

Dairy Crest (DCG LN, HOLD, T/P 630p) Q1 trading statement, released ahead of today’s AGM, confirmed a strong start to the year for the Cathedral City cheddar cheese brand, which enjoyed 15% volume growth. Overall, volume performance for Cathedral City, Clover, Frylight and Country Life was positive to the tune of 7%

Companies: Dairy Crest Group

08 Aug 17

UK E&P sector

In this note we revise our oil price deck, roll forward our NAV discount origins to end 2017, and update models for spot fx rates and operational updates. The net effect is to reduce PTs by 21% on average. However, our revised PTs still show considerable upside relative to the current share prices, and we believe the sector can still create value in a Lower for Longer oil price world. We retain Cairn Energy as our top pick. We also upgrade Faroe Petroleum to BUY, given an attractive valuation and defensive story.

Companies: CNE ENQ FPM TLW

16 May 17

Updating growth outlook for by-products

Dairy Crest (DCG LN, HOLD, T/P 630p) releases preliminary FY2017 results on Thursday this week. Our £424m expectation for sales revenue is similar to £423m Bloomberg consensus. However, we are more optimistic about margins. We look for £93.7m of EBITDA and 38.1p of adjusted EPS compared with figures of £89.1m and 35.3p respectively, which appear on Bloomberg.

Companies: Dairy Crest Group

23 May 17

Assura plc - Full Year Results

07 Mar 17

Grafton Group - Full year results 2016

31 May 17

LondonMetric - Full Year Results 2016/17 CEO Interview

25 May 16

Shaftesbury PLC - Half Year Results 2015/16

23 May 17

Shaftesbury - CEO interview on the results for the six months to 31 March 2017

12 Feb 16

Tembo Capital - Update at 121 Mining Investment 2016

24 Jul 17

Acacia Mining - Half Year Results 2017

17 Dec 15

Entertainment One - Amblin Partners output deal

23 May 17

EntertainmentOne - Final Results

26 Nov 15

LondonMetric - Half year results

29 Nov 16

Shaftesbury - 2016 Year End Results

24 Nov 15

Leading the Charge - Entertainment One

12 Feb 16

Petra Diamonds - Update at 121 Mining Investment

19 Nov 15

Grainger Plc - Full year results for the year to 30 September 2015

21 May 15

Assura plc - Analyst interview, Liberum

Latest Content

CLS

H1 2017 Results

CLS has delivered an excellent set of interim results in what has been a transformational period for the Group. Profit after tax increased to £99.0m (H1 2016: £29.5m) reflecting a property valuation uplift of £48.7m (H1 2016: £2.4m) and profit on sale of properties of £41.7m (H1 2016: £4.4m). The EPRA NAV per share increased to 268.5p (+9.3%) compared to EPRA NAV at 31 December 2016 at 245.6p (restated for the share subdivision). The progressive dividend has delivered an interim dividend at 2.05p (+6.6%) and on the basis of a one third: two thirds split we anticipate the full year dividend to be 6.15p. The shares have performed very well and are up 53% in the last 12 months and 40% YTD. Despite this the shares are still trading at an unwarranted 20% discount to EPRA NAV of 268.5p. We have increased our target price to 248p/share (from 234p) to reflect our view that the shares should not trade at more than a 7.5% discount to EPRA NAV. Buy.

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16 Aug 17
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CLS

Interim Results to 30 June 2017

CLS Holdings plc (CLI.L / CLI LN) has reported Interim Results for the period 1 January to 30 June 2017 today. The Company have reported a strong set of results with record EPRA net assets per share. Highlights are as follows: EPRA net assets per share: 268.5 pence (31 Dec 2016: 215.1 pence); Profit after tax: £100.0 million (2016: £29.7 million); Earnings per share: 5.3 pence (2016: 8.1 pence); and an Interim Dividend of 2.05 pence.

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16 Aug 17
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Vectura Group

Panmure Morning Note 16-08-2017

Vectura has signed an agreement with Dynavax for a lung cancer program using Vectura’s smart nebuliser technology. Vectura will receive some ‘modest’ milestones and development service revenues. We see the agreement as incrementally positive, though with the potential to be very significant in the future. It supports our argument that the depth of Vectura’s technology in the respiratory field makes it a partner of choice. We make no changes to our forecasts (either revenue or R&D spend). We reiterate our BUY recommendation and 150p price target.

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16 Aug 17
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SEGRO

Online push cont’d

Segro posted its first half 2017 results. Adjusted EPS was up by 3.2% to 9.7p against 9.4p yoy, incorporating the new shares issued in the March rights issue. The vacancy rate remains low at 5.5% against 5.7% in FY16. LTV stood at 29% vs 33% in FY16. EPRA NAV was up by 5.4% to 504p (vs 478p in FY16). The board proposed an interim dividend of 5.25p per share, up by 5% from the previous year. The group’s property portfolio was valued at £7.3bn at H1 17 (+4.9% lfl), of which a £5bn portfolio of warehouse properties in the UK and Continental Europe.

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16 Aug 17
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BMV BMN EMH HOC JAN

SP Angel – Morning View

Altus Strategies* (ALS LN) – Laboum gold prospect update | Bluebird Merchant Ventures* (BMV LN, Standard List) – Bluebird team find three entrances for Gubong gold mine | Bushveld Minerals* (BMN LN) – BUY – Target Price raised to 14p (formerly 11.6p) – Vametco profits exceed expectations as management target ambitious expansion | European Metals (EMH LN) – Infill drilling at Cinovec | Hochschild Mining (HOC LN) – On track for record 37m oz attributable silver production in 2017 | Jangada Mines (JAN LN) – Revised Pedra Branca resource estimate including copper and nickel.

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16 Aug 17
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HAT UDG ERGO MMH

N+1 Singer - Morning Song 15-08-2017

Ergomed (ERGO LN) Clinical hold on CEL-SCI’s Phase III removed | H&T Group (HAT LN) Positive interim results, benefiting from gold price increase | Marshall Motor Holdings (MMH LN) Deep value as strong performance ongoing & net bank debt reduces | UDG Healthcare (UDG LN) Acquisition-led upgrade momentum building

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15 Aug 17
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UDG Healthcare

N+1 Singer - UDG Healthcare - Acquisition-led upgrade momentum building

We have updated our forecasts for the two acquisitions completed in July and the recent trading update, upgrading EPS by 1-3%. We continue to be attracted to the long term story around UDG, with the track record of acquisitions having been exemplary so far. These attributes are no longer hidden under a bushel however and, with the shares trading on ~30x P/E, a 30%+ premium to its closest peers, UDG probably needs to grow into its valuation. We stay at Hold with a TP of 770p.

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