Best and worst shares on Super Thursday

On this Super Thursday for economics and blue-chip results, spare a thought for Howden Joinery (HWDN) and Tate & Lyle (TATE) in the relative shadows of the FTSE 250.

The pair probably won’t get the acclaim they deserve after pitching up today with impressive figures, particularly in the context of trading conditions that have been anything but encouraging.

Trade supplier Howden Joinery, which specialises in kitchen products and has 658 depots across the UK, said it continued to grow volumes as total revenues between June and the end October jumped by 8.2% on a year earlier.

Shares raced ahead 10% or 37p to 454p as this figure was much stronger than the overall rate of 6.3% for the first 44 weeks of the financial year. Although there was no upgrade to profit forecasts by the company, UBS analyst Mark Fielding said there was potential for upside given the supportive top-line trends.

UBS is forecasting full-year operating profit of £235 million against the current consensus of £228 million. Fielding has a ‘buy’ rating and price target of 475p.

Tate & Lyle’s improvement of up to 5% reflected further progress in its strategy of increasing focus on higher margin speciality food ingredients. Sales were up 6% in the first half of the year, helping profits to rise by 26% to £161 million.

This was aided by a return to volumes growth in North American speciality food ingredients, despite a “sluggish” food and beverage market as consumers increasingly seek alternatives to traditional brands.

With Tate’s bulk ingredients division also powering overall profits growth by 45% to £93 million, the group now expects a modest beat against previous FY forecasts.

In contrast to Howden and Tate & Lyle, gambling software supplier Playtech (PTEC) took a hammering after a warning that its performance for the full year will be around 5% below the bottom end of market expectations.

It blamed weakness in certain Asian markets and continued challenges for its Sun Bingo contract, which it signed as a five-year deal in 2015.

Playtech — founded by Israeli billionaire Teddy Sagi in 1999 — slumped by 25% to just 737p. Earlier this week analysts at Morgan Stanley increased their price target to 1,400p as they highlighted the company’s dominant share of the UK online casino market.

Another big downward movement came from Randgold Resources (RRS), whose shares fell 7% to below 7,000p in the FTSE 100 after a 9% drop in production in the third quarter led to a 41% decline in profits.

Chief executive Mark Bristow blamed a series of one-off issues and said that Randgold was still a leader in the gold mining industry in terms of value creation for stakeholders.

He noted that Randgold long-term plans were profitable at a gold price of $1,000 per ounce, compared with the company’s realised price for the quarter of $1,281.

He said: “Randgold stands out as one of only a few gold mining companies that consistently outperforms the gold price and delivers real value to its shareholders, host countries and other stakeholders.”

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Source.