Home > UK share prices watch: Halma rises on Tuesday

UK share prices watch: Halma rises on Tuesday

June 11, 2019 By Tsveta Zikolova

Hazard detection and life protection products company Halma (LON:HLMA) has been one of today’s UK share prices to watch, with investors reacting positively to the group’s full-year update. Compass Group (LON:CPG) meanwhile is in negative territory as it announced a €475-million acquisition.

Tuesday’s notable UK share prices

In notable blue-chip movers, Halma is outperforming the broader market, as it posted a 13-percent gain in full-year revenue for the 12 months ended March 31, as well as a 15-percent rise in adjusted profit before tax. The company further proposed a seven-percent rise  in dividend.

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“The market it serves is naturally a growing market given the increased needs from both consumers and regulators for safer and healthier living and working environments. These needs are longer term in nature and all the more important as populations grow and become more urbanised around the world,” Helal Miah, an investment research analyst at The Share Centre, commented, as quoted by Proactive Investors, adding that this reflected on Halma’s “steady revenue and profitability growth over the years and the group has been proud to say it has raised the dividend by seven percent, marking the 40th consecutive year of dividend growth of at least five percent”. Halma’s share price has added about 2.8 percent in early afternoon trade, as compared with about a 0.5-percent gain in the benchmark FTSE 100 index.

Investors meanwhile have reactive negatively to an announcement by Compass that it has inked a deal with Fazer Group to acquire Fazer Food Services, which operates in Scandinavia, for an enterprise value of approximately €475 million. Compass’ shares are underperforming the broader London market with a 0.35-percent fall.

A proposed acquisition has failed to move Smith & Nephew’s (LON:SN) shares, as the artificial hips and knees maker announced that it was buying Atracsys, a Switzerland-based provider of optical tracking technology used in computer-assisted surgery, for an undisclosed amount. Smith & Nephew’s share price about 0.4-percent up, largely in line with gains in the FTSE 100.

In smaller London-listed companies, Saga (LON:SAGA) has been volatile after it emerged that the cruises-to-insurance group for the over-50s had inked a partnership deal with Goldman Sachs’ savings bank Marcus, which launched in the UK in September last year and  has so far attracted over 250,000 customers. The news is a welcome development for the company, whose stock came under pressure earlier this year as the lifestyle group booked a £310-million charge and trimmed its payout to shareholders. Saga’s shares, however, are down by nearly one percent in early afternoon trade, having surged more than three percent in the morning.

Ted Baker (LON:TED) meanwhile has lost more than a quarter of its value today as it reported “extremely difficult trading conditions during the financial year to date,” and warned on profits. The BBC quoted analysts at Liberum as commenting that the “short-term and identifiable issues around product” were being addressed quickly but the “unpredictable trading backdrop across all markets appears to have less end in sight”. Ted Baker’s shares are changing hands more than 26 percent in the red.

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UK stocks to watch tomorrow

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British American Tobacco (LON:BATS) will be one of the UK share prices to watch tomorrow, with the group set to post a pre-closing trading update ahead of its half-year report on August 1.

“British American Tobacco faces the same headwinds, as its traditional products see declining use and greater regulatory scrutiny. E-cigarettes continue to see growth, but there is a long way to go before these can completely replace traditional cigarettes,” Chris Beauchamp at IG commented in a note last week. “The firm continues to pay a solid dividend, and cash generation remains strong, so a cut looks to be an unlikely possibility.”

Britain’s biggest grocer Tesco (LON:TSCO) will also be in focus in the run-up to its results later in the week. Proactive Investors reports that UBS has lifted its price target on Britain’s biggest grocer, arguing that consistent margin rebuild in the UK business and like-for-like sales growth outperformance reflects ‘genuine reconnection’ with shoppers and ‘superior terms of trade’ resulting from ‘innovative approaches’ with suppliers. The broker, however, reckons that  the market remains ‘inherently sceptical’ with the share price little changed year-on-year and consensus estimates for 2021 earnings per share of 19.8p still seven percent below management expectations.

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