Daily Stock Market Report (Fri 24 Jan 2025) - ZTF, IOF, BMY, BRBY, REC, BEG

24th Jan by Graham Neary

78 comments 5727 reads

Good morning everyone,

I'm writing to you this morning while Storm Eowyn is having a blast. Good luck to everyone affected!

Megan and Mark have kindly provided us with a few backlog sections to get us started.

Podcast: our weekly podcast has been published, this time featuring Ed, myself and Lawrence. Ed discusses the findings of his new article - "The Jump - what to do when share prices react to Trading Statements".

Here are the links:

Spotify, Apple Podcasts, YouTube, and Amazon Podcasts.

1pm: this report is complete, have a nice weekend everyone.

Spreadsheet accompanying this report (updated to 17/1/2025)

Companies Reporting

Name (Mkt Cap)	RNS	Summary	Our view (Author)
Severn Trent (LON:SVT) (£7.4bn)	TU	In line. Accepts Ofwat’s Final Determination for 2025-30. Dividend growth to match CPIH.
Burberry (LON:BRBY) (£3.7bn)	Q3 TU	Q3 LfL store sales -4%. After festive period, now more likely H2 will broadly offset H1 loss.	AMBER (Graham holds) Excellent rebound in H2. Stock does already price in a return to meaningful profitability.
Paragon Banking (LON:PAG) (£1.6bn)	TU	Full year guidance reiterated.
Renew Holdings (LON:RNWH) (£718m)	TU	Rail Sector is behind exps, so FY 2025 will be below exps but still ahead of 2024 (adj. profit £70.9m).
Bloomsbury Publishing (LON:BMY) (£533m)	New agreement with Amazon	New long term supply agreement. Reiterates confidence in consensus expectations.	AMBER/GREEN (Graham) Last-minute deal agreed, terms unknown. Valuation somewhat full here?
Begbies Traynor (LON:BEG) (£148m)	Latest Red Flag Alert	“Critical” financial distress climbs by 50% q-on-q. Hotels, Leisure and Retailers the worst affected.	AMBER (Graham) There could be a wave of insolvencies this year, especially in certain badly-hit sectors exposed to the consumer, higher rates and tax rises.
Quadrise (LON:QED) (£103m)	Result of Placing and Subscription	Raises £4.5m with an upsized placing, £1m also expected from a Retail Offer.
Record (LON:REC) (£95m)	Q3 TU	New equity fund launched. Neutral net flows. Performance fees are helping, revs now slightly ahead.	GREEN (Graham) No major changes to forecasts. I like the value here even if growth may be limited.
Pulsar (LON:PULS) (£70m)	TU	FY Nov 2024: ARR +£2m at constant currencies to £61.7m. Adj. EBITDA £9m, in line.
Works co uk (LON:WRKS) (£12m)	H1 results	LfL sales down 0.8%, in line with exps. Adj. EBITDA…

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Lord Gnome

24th Jan

Can't agree with you there, sparkler. SQZ is like the vast majority of oil shares on the UK market. Unloved and unwanted because of the green agenda. It's had a few operational issues, but nothing out of the ordinary for an oil stock.The company has just reiterated its commitment to shareholder returns. The divi is rock solid - all IMHO of course. I added this week as well. That yield is just too, too tasty.

jonno

Van Elle Holdings (LON:VANL)

The company acknowledged the challenging conditions in its December update

"Market conditions have continued to be challenging across all sectors. Workload has been subdued in Rail, as the sector transitions from CP6 into CP7, and Highways continues to experience project delays. The impact of the Building Safety Act has caused delays to start dates of taller residential schemes however encouragingly the new build housing sector has continued to recover, with a strong pipeline of work planned for delivery throughout the second half of the financial year."

However unlike Renew Holdings (LON:RNWH) it continues to expect to meet market expectations for the FY25, albeit second half weighted.

Extract from trading update 12 December:

"The Board continues to expect results for the full year in line with market consensus¹, and as previously communicated, anticipates profitability being second half weighted....

Company compiled analyst consensus for FY2025 underlying profit before tax is £6.0m."

Also, since mid December, Rockwood Strategic (LON:RKW) has increased its holding from 5.95% to 9.24% and Peter Gyllenhammer acquired 4.24% of the shares just over a week ago.

I would further add that Directors have spent over £100,000 in the last month or so.

On the basis that the company hits its earnings forecast the shares are very cheap on a whole range of metrics, which show a swath of green on the stock page together with negligible net debt.

Posted by a biased holder of a full size position with an average purchase price of 38p.

john2

Bezos bully boy tactics is the right description. The Amazon book store is famously a long tail business in which the vast majority of sales come from quite a small number of titles. I cannot imagine that they would have wished to carry on for very long without being able to sell the Harry Potter and Sarah J Maas titles.

planetx

My point is this

It is entirely within the gift of any company to tell amazon to get stuffed

I was under intense pressure at px from my sales team to list on anazon to grow sales

Luckily or unluckily i was a 90% owner with a black and white on the spectrum brain and just told them no, “i dont agree with the way they do business and thats the end of it “

No CEO of a public company probably has this in their gift but you only have to dance with the ones you want fo dance with .

Rusty2

Anyone else having problems on the IG platform?

Graham Neary

Sorry Rusty2, I didn't get to RNWH!

Hi Silver Moon, I like the new name! I'll have to make sure I check out the full year results in March. Nice TU yesterday. G

bensummers

yes unstable - my watchlists were down

Thanks, at least it their system not mine.

Watchlists work but l have nothing in my positions, so l can't sell anything. Search often does not work, not available it says.

Silver Moon

Everplay Group may well come out to play, I'll hold a little longer.

What I was suggesting was that Bloomsbury should have told Amazon to get stuffed. I bet their titles form a significant percentage of the Amazon book sales.

KBR

Renew Holdings (LON:RNWH)

Hello DWit199. Thankyou for that reply . However on reading the CEO review I still cannot see any reference to CP7 being slower!!!! Hope you can assist further. KBR.

Team17 (LON:EVPL) Is it suspended today? If so why, it is only a name change.

Seems to available now.

CautiousValue

Related to this there is an interesting strategy originally by Benjamin Graham that John Huber wrote up a while ago, buying large (mega) cap stocks when they are out of favour. Clearly it won't work every time but I have started it recently, so far to modest success. LVMH a while ago, ASML more recently. I have pondered others at various points (Nike, TSMC, Meta) and failed to act, regretting all but Nike (so far). I'm not sure Burberry would be 'quality' enough for me to use in that context but the other luxury names certainly are.

Thoughts on Ben Graham's "Unpopular Large Caps": A Still-Effective Strategy

Certainly has worked in the US, buy Apple (NSQ:AAPL) Alphabet (NSQ:GOOG) Meta Platforms (NSQ:META) Microsoft (NSQ:MSFT) Shopify (NYQ:SHOP) even NVIDIA (NSQ:NVDA), when they are down, also the Stockranks were down also. You don't have to go back very far, about 2 years. I kept buying Alphabet (NSQ:GOOG) when it was falling, it soon went back up, now over 100% up from $90. The others have doubled also.

intuitive6191

The problem is big business in the US and China is now intertwined the Governments of these countries.

Pushback against the business and they take it as being anti US or anti China. I dont know how you hit the sweet spot of taxing/ restricting US and Chinese business without ruining further trade discussion or attracting sanctions in return.

This sort of thread has popped up about a dozen times in the last couple of years. Its the type of sitiuation that no one disagrees with - but to which there is no easy solution.

We could have bluffed our hand a bit better, instead Reeves and Starmer chose for a two month period prior to the budget to talk our economic prospects down.

Its one thing having a weak hand but telling everyone round the table you are drawing dead is a not a good idea.

DWit199

However on reading the CEO review I still cannot see any reference to CP7 being slower!!!!

It's in the fourth paragraph of the Rail section of the CEOs review.

"We have continued to selectively expand our Rail client base outside of Network Rail and overall, we commenced CP7 in a significantly stronger framework position than at the start of CP6. Whilst we note that the start of CP7 has been slower than expected, we remain confident that this will normalise through the control period as we have seen historically."

Hard to believe that a short sentence hidden in a long report could have such significance. The Renew share price has been in decline since the results in November so quite a few people did work it out.

Link to article

rmillaree

i dont doubt you are right to a certain degree

ultimately though post brexit we can set out own rules that are not obviously unfair (ie google must account for vat to uk authorities if they have sales from non vat registred uk business - that would just be vat neutral)

its not about screwing these companies over just ensuring they pay a fair level of taxes

If i was in charge i would be running a level playing field and dealing with consequences if they arose. Look at apple they got backdated bill from ireland but they didnt up sticks and leave - i very much get teh feeling its a no lose gamble for these companies - all cash they get (perhaps exception of soem amazon stuff) is so proitible you could easily take an extra 20-30% and it would just be a rounding figure on their annual results !

We do nowt but add an extra 6% corp tax onto companies based in the uk!

So the fact there may be resistance deosnt mean soemthig cant be acheived - heck with trump all you gotta rprobably do is give him a nice pr bone and he is probably happy plenty of way to sort that out.

Not even sure its shoudl be up to the politicians here Jim Harra has to be the worst head of hmrc ever - try and comprehend this statement making any sense on any level - i guess if you dont look you dont see !

HMRC has found “no evidence of fraud” in a case where 12,000 Chinese companies changed their addresses to a flat in Cardiff.

Jim Harra, the permanent secretary at HMRC, told MPs on Thursday that it was an “odd” and “curious” incident, he said there has been “no fraud perpetrated on HMRC as a result of this and it’s not clear that it was an attempt to defraud us”.

https://www.independent.co.uk/...

,Renew Holdings (LON:RNWH) Thankyou so much DWit199. Must read every word of complete document . However it was pretty well concealed in the full sentence. However not a acceptable excuse for me!!! KBR

Epitychia

25th Jan

Saw this on Lords of the Rings. It didn't end well.

Daily Stock Market Report (Fri 24 Jan 2025) - ZTF, IOF, BMY, BRBY, REC, BEG

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Graham Neary

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