Source: Sharecast
Shares in Auto Trader tanked despite the new and used car platform delivering a confident outlook alongside its annual results, with the stock pulling back after a strong surge since the start of April.
It said group revenues rose 5% to £601.1m over the 12 months to 31 March, as 7% growth at the core Auto Trader platform to £564.8m outweighed a 12% decline in sales at the van-leasing division Autorama to £36.3m. Group operating profits rose 8% to £376.8m.
Richard Hunter, head of markets at Interactive Investor, said: "A strong recent run in the share price has led to some significant investor displeasure at the open, given that the results were no more than in line with estimates and with the outlook containing few positive surprises."
Utilities, which are bond proxies, were under the cosh, with National Grid and Severn Trent among the worst performers.
Elsewhere, Phoenix Group lost ground as Bank of America Merrill Lynch downgraded the stock to ‘neutral’ form ‘buy’.
It said the shares have returned 32% year-to-date and it now only sees 13% total return potential, hence the downgrade.
The bank said Phoenix’s new chief financial officer addressed its key issue - falling shareholders’ equity - with full year results.
"He provided confidence that the dividend was sustainable and will grow progressively. But the yield no longer stands out versus peers," it said.
It said Phoenix’s 8.5% 2025E dividend yield remains attractive and the third highest dividend yield in the FTSE 100 and that with 2.5% per annum growth ahead, Phoenix retains appeal.
"However, this yield must be seen in the context of a UK 10-year bond yield at 4.7%. The yield spread over the sovereign yield of 3.8% is in the bottom-half of European insurers. Phoenix’s yield is also only the third highest in UK Life insurance and only around the same level as Aviva pro-forma for its Direct Line Group (DLG) acquisition if buybacks are also included."
FTSE 100 - Risers
easyJet (EZJ) 578.00p 2.96%
SEGRO (SGRO) 689.80p 2.47%
Glencore (GLEN) 278.70p 2.44%
Pershing Square Holdings Ltd NPV (PSH) 4,040.00p 2.18%
Standard Chartered (STAN) 1,164.50p 2.15%
Prudential (PRU) 849.20p 1.92%
Convatec Group (CTEC) 287.20p 1.92%
Legal & General Group (LGEN) 247.10p 1.85%
Taylor Wimpey (TW.) 119.80p 1.74%
Persimmon (PSN) 1,336.00p 1.60%
FTSE 100 - Fallers
Auto Trader Group (AUTO) 808.60p -10.16%
National Grid (NG.) 1,033.50p -3.55%
Relx plc (REL) 3,955.00p -2.78%
Severn Trent (SVT) 2,659.00p -2.31%
Coca-Cola HBC AG (CDI) (CCH) 3,866.00p -1.78%
Marks & Spencer Group (MKS) 375.40p -1.50%
Kingfisher (KGF) 281.50p -1.33%
Phoenix Group Holdings (PHNX) 634.00p -1.32%
Intertek Group (ITRK) 4,746.00p -1.29%
Rightmove (RMV) 752.20p -1.23%
