Daily Stock Market Report (Fri 9 May 2025) - RMV, OCN, BAKK, ARB, SHED/LMP

Good morning! Welcome to Friday's report.

The Bank of England cut rates to 4.25% yesterday, as expected. Of greater interest than the decision was the composition of the vote, with the Monetary Policy Committee unable to present a united front: five of the nine members wanted the rate cut, two wanted a bigger cut, and two wanted no cut at all.

12.55pm: wrapping it up there as news flow is light today, have a good weekend!

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Today's Agenda is complete.

Companies Reporting

Name (Mkt Cap)	RNS	Summary	Our view (Author)
AstraZeneca (LON:AZN) (£157bn)	Imfinzi improved disease-free survival (bladder cancer)	“Statistically significant & clinically meaningful improvement in disease-free survival”
International Consolidated Airlines SA (LON:IAG) (£13.7bn)	Q1 Results & 53 new Airbus and Boeing aircraft	2025 outlook unchanged. New aircraft to grow/replace long-haul fleets. Delivery 2028-2033.
Rightmove (LON:RMV) (£5.8bn)	Trading Statement	Guidance unchanged. Expecting 8-10% rev growth. ARPA growth plus 1% membership growth.	AMBER/GREEN (Graham holds) There is nice product-led growth in the short-term but even so, it must be getting close to fair value. Momentum now driving it higher - will it go through the price at which REA was willing to buy it?
Bakkavor (LON:BAKK) (£1.05bn)	Extension of PUSU deadline	More time needed for discussions with Greencore (LON:GNC) and “mutual confirmatory due diligence”.	PINK (Graham) [no section below] As noted in April, while I'm supportive of this deal in principle, I am a little concerned about how it will be financed. There is also supposed to be an option included in the deal for Bakkavor shareholders relating to their US subsidiary, which I thought could be legally complex. My assumption is still that this deal will go ahead.
Urban Logistics Reit (LON:SHED) (£677m)	Recommended Offer	Londonmetric Property (LON:LMP) offers .5612 new LMP shares and 42.8p cash for each SHED share. Total value 150.3p, a 21.8% premium to the undisturbed SHED share price.	PINK (Graham) [no section below] The two companies have been discussing this for the past month, and today the details are provided. As of now shareholders representing only 6% of SHED have provided undertakings to support it, so it will depend on further support. I note that the current SHED share price (152p) is slightly above the value offered - suggesting to me that at least some SHED shareholders believe more value is possible. Edit - timarr in the comments points out that a dividend is also payable to SHED's shareholders.
Ocean Wilsons Holdings (LON:OCN) (£467m)	Quarterly Update	Investment portfolio valued at $321m (or £7.03 per share). Aggregate NAV of £21.06.	AMBER/GREEN (Graham) At a stonking great discount to NAV, this might be worth being fully positive on, but I'll hedge my bets for today.
ITM Power (LON:ITM) (£217m)	NEPTUNE II contract with a cement producer	Customer is a well-established Spanish cement producer. Revenue recognised in FY26.
Aquila European Renewables (LON:AERS) (£177m)	NAV, Factsheet and Managed Wind-Down Update	NAV +0.1% (83.95 Euro cents). Has preferred bidder for majority of portfolio. Update by end-June.
Argo Blockchain (LON:ARB) (suspended at £18m)	2024 Annual Results and Restoration of Listing	Going concern warning. Audited 2024 results are published with a net loss of $55m including a $31.5m impairment charge. Adjusted EBITDA $5.7m. A new CEO has been appointed as of March, an internal hire.	RED (Graham) [no section below] The fat lady is clearing her throat for Argo Blockchain. It had a cash balance of $8.6m (Dec 2024), and this has since reduced to $2.4m (March 2025). Net debt was $31m at the end of 2024; this includes $40m in bonds maturing in November 2026, with quarterly interest payments. The going concern note from the auditor states that additional funds are needed during H2.
Ocean Harvest Technology (LON:OHT) (£2m)	Funding Update	“...recent events could constitute an event of default under the terms of the Loan Notes.”	RED (Graham) [no section below] In default and in need of additional funding: equity presumed worthless.

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Graham's Section

Rightmove (LON:RMV)

Unch. at 744p (£5.8bn) - Trading Statement - Graham - AMBER/GREEN

At the time of publication, Graham has a long position in RMV.

This has been a reasonably successful investment for me, and is 5% of my portfolio.

While there are occasionally concerns around competition - and these were heightened by the American acquisition of OntheMarket in 2023 - the main issue that investors tend to have with Rightmove is a lack of growth. The thinking goes that this is a mature market and Rightmove, as the market leader, has little room to grow.

Today we have an update for the first four months of the year.

Revenue growth expectations for the year are reiterated at 8-10%. The StockReport shows that the company has enjoyed long-term average growth (“CAGR”) of 6%, so it’s doing a little better than that currently.

The growth is not coming from more estate agent customers, but instead mostly from enticing existing customers to use their deluxe package:

We continue to migrate remaining partners from Optimiser 2020 to Optimiser Edge (our top-end Estate Agency package), as well as delivering new products across both Estate Agency and New Homes partners.

Market share: Rightmove say they are responsible for “over 80% of all consumer time spent on UK property portals”.

Checking the footnotes, this has been calculated against Zoopla, PrimeLocation and OntheMarket.

If I scroll back to the full-year results for 2023, the equivalent metric given then was “over 86%”. So I do think that the competitive position may be a little tougher now than it was back then.

New features: these include an instant online valuation of a property for consumers, an enhanced microsite (mini website) for estate agents, and live appointment booking for New Homes. They also continue to develop the offerings related to commercial property, mortgages and rental services.

Housing market: this section is generally positive with reducing mortgage rates and optimism among new homes developers.

CEO comment:

"We're pleased to have started 2025 with good financial, operational and strategic momentum… In the current uncertain global climate, our UK-focused, subscription-based and B2B-oriented business model means that we are comparatively well insulated from the volatility that some other companies and industries are having to contend with.

Graham’s view

This has been one of my favourite UK stocks for many years.

As usual, it comes down to price - it’s usually quite expensive. How positive can I be on a stock trading at this earnings multiple?

Perhaps unsurprisingly, Rightmove is a “High Flyer” in Stockopedia terms - high quality and high momentum, but apparently little Value.

I was AMBER/GREEN on this in February; the share price is up by 12% since then.

It only needs to rise by another 5% to reach 781p, the level at which the Australian group REA was willing to buy the entire company last year.

At the time, I said that 800p was the minimum level at which I personally would even consider a takeover offer.

On balance, I think AMBER/GREEN remains a fair take, although I admit that this is influenced by the momentum factor. In value terms it must be getting close to a fair valuation, even for its most optimistic shareholders.

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Ocean Wilsons Holdings (LON:OCN)

Up 3% to £13.62 (£484m) - Quarterly Update - Graham - AMBER/GREEN

This is a “Bermuda based investment holding company” with two subsidiaries: an investment portfolio and a Brazilian port and maritime logistics company.

It looks to be a special situation as the logistics company is being sold.

The Brazilian Real has depreciated a little against the pound since October, so the value of this disposal must have also depreciated a little:

Based on exchange rates at the time of the announcement of the transaction in October 2024, the Company expected to realise cash proceeds, net of transaction costs and taxes, of at least US$593 million.

$593m would be worth c. £447m at current exchange rates.

The company does give us an aggregate, overall net asset value for all of its holdings: $27.20 or £21.06 per share.

This implies that its shares trade at a 35% discount.

Investment portfolio: I’ve quickly taken a look at its portfolio and I would summarise it as a highly diversified fund of equity funds, including private equity. Today’s update says that the portfolio decreased in value by 1.3% in the three months to March. I hope it got on ok in April!

The investment manager is Hanseatic Asset Management which is part of the same group as OCN’s largest shareholder, Hansa Capital Partners.

Disposal: the previously mentioned disposal of Wilson Sons in Brazil “remains subject to the ongoing regulatory review process”, but is anticipated to occur in Q2.

Use of proceeds: OCN plans to buy back 20% of its shares. That should cost over £100m, depending on the price offered. However, that will only be a fraction of the amount received in the disposal. What will they do with the rest?

The Board continues to consider a range of strategic options in relation to its use of the rest of the net proceeds of the Transaction remaining after completion of the Tender Offer. The Board expects to make a further announcement as and when appropriate.

Graham’s view

I’m happy to give this at least an AMBER/GREEN as I think the vast majority of UK-listed stocks of this type - REITs, investment trusts, investment holding companies - are trading cheaply in the current environment. At a 35% discount, this is another one to add to the list.

Looking for a clue in the 2024 annual report as to what they might do with the rest of the disposal proceeds, I find:

The Company’s objective is, and will continue to be post the completion of the sale of Wilson Sons, to focus on long-term value creation through its investment holdings, leveraging our long-standing investment market relationships and through detailed insights and analysis.

I’m tempted to go GREEN on this and maybe I will after further research. For now, I’m comfortable with a more cautious AMBER/GREEN. The discount is certainly appealing. The prospect of a tender offer is, too.

However, I’m uncertain as to how the rest of the disposal proceeds might be used. My assumption is that it will be used to expand the existing investment portfolio.

And I’m always somewhat resistant to investments where there are multiple layers of management (and fees) between me and the actual investee. I perceive that many of the holdings in the OCN investment portfolio are funds that I could buy myself, if I wanted to - an S&P 500 ETF from Blackrock is the largest holding, for example, taking up 7.5% of the portfolio. It's more difficult to justify owning an investment company when I could independently invest in many of the same assets and cut out layers of fees.

Therefore, while I’m open to the possibility that this is worth being fully positive on, I’ll hedge my bets for today.