Daily Stock Market Report (Fri 2 May 2025) - PSON, SHEL, GAMA, NWG, ROR, APAX, STAN

5:58am by Roland Head

34 comments 3491 reads

Good morning! After a busy week for company updates, let's see what the newswire has lined up for us today.

The agenda is now complete, with something of a big-cap bias today. Please share any requests for backlog items in the comments below.

11.30am: that's a clean sweep, so I'm wrapping up today's report. Thank you for reading and I hope you enjoy the long weekend. We'll be back with you on Tuesday.

Companies Reporting

Name (Mkt Cap)	RNS	Summary	Our View (Author)
Shell (LON:SHEL) (£146bn)	Q1 Results	Ahead of exps. Q1 adj earnings of $5.8bn (+52% vs Q4 24). Divi unch, further $3.5bn buyback.	AMBER (Roland) Q1 results have received a boost from the group’s core oil and gas production business. Shell has a clear strategy and seems to be executing well. A stronger balance than BP has allowed it to maintain aggressive share buybacks. However, earnings forecasts have been trending lower and macro uncertainty remains. Without taking a stronger and more subjective view on commodity prices, I think I have to remain neutral at current levels.
Natwest (LON:NWG) (£42bn)	Q1 Results	Q1 adj profit +36% to £1,252m. Q1 return on tangible equity of 18.5%. Net impairment charge of £189m. 2025 income and returns are now expected to be “*at upper end*” of guidance.	AMBER/GREEN (Roland) [no section below] Today’s Q1 results are ahead of consensus expectations, according to Reuters. CEO Paul Thwaite now expects full-year results to be at the upper end of expectations. Based on guidance for FY25 RoTE of 15%-16%, this implies the remainder of the year might not be quite as profitable as Q1. One reason for this might be the bank’s view on the UK economy, highlighted by today’s higher impairment charge. On a more positive note, the UK government’s holding fell below 2% yesterday, so NatWest is now fully under private ownership again, for the first time since 2008. The shares aren’t as cheap as they were, but the fundamentals look strong to me and the c.6% yield seems safe enough. I’m happy to maintain our moderately positive view on this bank.
Standard Chartered (LON:STAN) (£26bn)	Q1 Results	Q1 adj profit +11% to $1,357m ahead of exps. Tariff uncertainty. 2025/2026 guidance unchanged.	AMBER (Roland) [no section below] Today’s update seems broadly positive, but highlights the “increased global economic and geopolitical complexity” resulting from tariffs. I…

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Daniel Alderman

12:02pm

I would expect the price to increase as it gets included in the index at least in the short term, see

Norfolk'n'Good

12:39pm

Re Warpaint London (LON:W7L)

I've been scratching my head a bit on the recent results and trading update/outlook for Y/E'25

Easier to bullet point

SALES - Y/E 12 '25 Forecast of £128M ('24 Y/E £101.6M) using all current forecast/info looks too high even with the inclusion of Brand Architeks. Equates to +26%, but Q1 currently only +14% albeit against a strong comparator in Q1 '24. However management are NOT given to overstating co's prospects/forecasts.

PBT Y/E 12 '25 forecast increase +18% and EPS forecast +10.6% BOTH seem too LOW especially given the excellent operational gearing - see this in action in Y/E12 '24's results

GROSS MARGIN - Increases from 39.9% to 41.2% for Y/E '24

OPERATING COSTS Up in '24 vs '23 a modest 1% - amazing given levels of growth achieved

DEBT None, nett cash, even after the acquisition of BA and the extra £ that must be needed for ever expanding working capital requirements and increased Tax payments - see below

STORE ROLL OUTS Big numbers of new stores in Europe, USA, UK with Denmark, Spain and the Netherlands seeing significant sales growth all +20%. UK expansion into Tesco, Morrisons, Superdrug, Boots

ONLINE SALES +35% with fulfilment in many countries via Amazon

TARRIFFS Majority of product is made in China but US Sales are only c8% of all sales so any 'damage' would surely be minimal but could be another reason forecast sales are not achievable

CONCLUSIONS From all the info I have read so far I find it hard to accept that the 12/25 Sales figure of £128M can be achieved, However I'm not sure this matters as the forecast EPS and PBT figures definitely look beatable, unless I am overlooking something?

ADDITIONAL THOUGHTS

Store roll outs must cost money for new displays etc - so may see costs increase but can't imagine this is massive and has been going on for a number of years anyway

Working Capital requirements are clearly going to increase but again at what cost? Co is nett cash and so will only be a 'loss' of interest income, which is probably quite minimal

Can anyone add any further thoughts here? Am I missing something glaringly obvious? I know that the Corporation Tax Rate & HMRC payments schedule have been increased/changed due to the size of the business and so will clearly affect net cash held, PAT & EPS but again nothing too onerous...

murrb

12:44pm

My tuppence worth : as has already been noted, Octopus was the largest holder of GAMA when GAMA announced the move to the main market. I believe they had to sell down before today. That meant there was a deadline to meet. Any professional knowing all of this and looking for a good entry price would be unlikely to buy much before the deadline, meaning liquidity for Octopus would not be good thus exaggerating the price drop. A few weeks ago GAMA announced a 50 million pound share buy back. Those shares were largely to be cancelled. So there is now a lower share count, down several percent, which should add positively to the value of each share going forward. It also allowed Octopus to complete selling. Key dates over the next couple of months - end of May ftse quarterly index rotation will be announced and it is likely GAMA will be included in the ftse 250 index. I expect that move would be effective as of the end of June. Further, there is an ex-div date at the end of May. Some of these events may result in share price appreciation. Finally, there will be an AGM on May 14th and in previous years this has been accompanied by a trading update.

The Phoenix

12:45pm

Great write up Matthew thanks for flagging.

shanklin100

1:05pm

Hi Matt, I appreciate your wish to behave ethically BUT can see no reason why you should not do all your selling (in this case) before releasing your 4imprint (LON:FOUR) research to your substack. After all, you did the research and should be the primary beneficiary of it. You owe the rest of us nothing

cshfool

1:21pm

Useful write-up on Shell (LON:SHEL) , thanks for this.

yiannos1

1:31pm

Warpaint London (LON:W7L)

That have raised all the amount for the acquisition of BA; something that made me think twice at the time having in mind that BA had half of that in cash!

All the best

Bouden54

1:40pm

Thanks for the write up on 4imprint (LON:FOUR) I actually made the opposite move, recently buying. I think there is a fair chance of another profit warning in the near term (possibly a big one if we see significant disruption such as you have described), but prepared to sit this out as feel this should blow over quite soon and FOUR should emerge stronger in the long-term as weaker competitors fail. Only a small position though as I expect this to remain volatile.

MatthewBrazier

1:52pm

Thank you for that, shanklin100.

I have a tendency to change my mind often and overtrade. This could create a conflict of interest when combined with writing about stocks, particularly when they are small and illiquid as many of those which I trade and write about are. I want to steer as far away as possible from any hint that I might benefit from people following me into trades, and only trading following a delay after publishing seems like the best way to achieve this.

You might say that a better way would be not to write at all, but I enjoy writing and see it as a way to showcase my work as well as bring discipline to my investing process. Perhaps it will turn into a paid subscription service one day, but right now I'm just seeing how it goes. I also see it as a way to build a network - being a full-time private investor can be quite solitary.

I'm pretty sure that no one is following me into trades currently as I don't have many subscribers and hope (and suspect) that my readers are independently minded in any case, but I'd rather try and avoid the possibility altogether. Enforcing a lag between deciding to trade and executing might also help to reduce overtrading!

boringchess

2:14pm

Sounds like Serica Energy (LON:SQZ) Enquest (LON:ENQ) deal is not happening?

2:26pm

I have posted yesterday the May performance for the S&P for the last ten years. No need to post it again.

You are missing the very important point that we already had one of the worst and violent corrections in history in April.

There are plenty of opportunities in both the US and the UK at the moment.

There are companies over the pond they will be growing their revenues at 25%+ CAGR for at least the next 10 years

Robinhood Markets (NSQ:HOOD) is just one of many.

2:32pm

Looks like Serica shares holding up well and Enquest starting to tumble a bit, normal I guess due to the reverse nature of the acquisition, Enquest had maybe been up a bit as it was expected Serica would pay some level of premium to take it on

I am long Serica and perfectly happy with the decision, much less uncertainty ahead by not doing it, doesn't feel the time anymore to do something big like this, too much uncertainty in the world already

Don't know if the writers will have time to say anything about it this late in the day but would be curious to see their thoughts next week

2:34pm

Paul Scott has also recently bought a small amount as have I, like yourself the start of a long term hold for me so dipping my toe in now to watch.

way

3:13pm

Seems the markets like the idea of PM Farage.

3:17pm

Yes that’s the reason

Not the payrolls!

jonno

3:25pm

Further to my earlier post I have bought an opening position in Restore (LON:RST). Unexciting perhaps, but Charles Skinner, CEO knows the business inside out and like many small caps it is hardly expensive.

The share price is starting to tick up and there has been significant buying by management. Most notably Charles Skinner bought 100,000 shares at 280p last August and more recently spent a further £100,000 acquiring 44,438 shares at 225p. CFO, Dan Baker has also been a buyer, spending £150,000 on the shares between November 2023 and August 2024. More recently he purchased a further 25,000 shares at 224p.

I like it when senior management spend their own money on shares as opposed to nil cost options.

sparkler

4:04pm

As we end the week with the FTSE 100 registering its fifteenth consecutive daily rise (yes, you did read that correctly!) it provides another reminder of the perils of market timing. Three weeks back several posters on this site were talking up how pleased they were to have sold as markets fell and that they were now staying in cash for the foreseeable future. In the horribly grim market at that time this all sounded like a perfectly sound strategy........ until suddenly, and with no obvious catalyst, it wasn't!

I am absolutely not immune to bad stock selections myself and have suffered with two or three of those in recent weeks. Luckily, what I didn't do was compound those individual mistakes by trying to be clever with the market as a whole. No doubt there are many subscribers now sitting in that uncomfortable place where they are holding too much cash but can't bring themselves to jump back in to their favoured stocks at prices now considerably higher than where they were sold. Painful isn't it?

My advice. Work out what amount you are comfortable to keep in the stock market for the long-term and then stay fully invested.

DutchSchulz

4:24pm

Edit: Hadn't seen sparklers post as I was preparing this. Apologies for the repetition.

Despite the weather forecast, here's something to (hopefully) cheer us all up today. Reported on CNBC today.

While global markets have been gripped by turbulence in the wake of U.S. President Donald Trump's seesawing tariffs policies, British stocks have enjoyed a bumper rally. London's FTSE 100 index, which has gained more than 5% since the beginning of the year, rose by 1.25% on Friday. It marked the fifteenth consecutive day of gains for the index, its new longest run ever.

4:32pm

I suspect it is more the 'comparative cheapness' of the UK market and likelihood of interest rate cuts rather than Mr Farage and his political aspirations that is providing a tailwind for UK equities. Helped by the economic uncertainty and lack of political leadership in America

As oft said careful what one wishes for!

Callum Cowan1

5:56pm

100% Yiannos

I see opportunity and good looking charts all over my screens currently, hitting the nail on the head with your comment on last months activity

I'm glad we still have some sanity on this board

Callum

Daily Stock Market Report (Fri 2 May 2025) - PSON, SHEL, GAMA, NWG, ROR, APAX, STAN

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Roland Head

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