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!
Today's Agenda is complete.
Companies Reporting
| Name (Mkt Cap) | RNS | Summary | Our view (Author) |
|---|---|---|---|
AstraZeneca (LON:AZN) (£157bn) | “Statistically significant & clinically meaningful improvement in disease-free survival” | ||
International Consolidated Airlines SA (LON:IAG) (£13.7bn) | 2025 outlook unchanged. New aircraft to grow/replace long-haul fleets. Delivery 2028-2033. | ||
Rightmove (LON:RMV) (£5.8bn) | Guidance unchanged. Expecting 8-10% rev growth. ARPA growth plus 1% membership growth. | AMBER/GREEN (Graham holds) | |
Bakkavor (LON:BAKK) (£1.05bn) | More time needed for discussions with Greencore (LON:GNC) and “mutual confirmatory due diligence”. | PINK (Graham) [no section below] | |
Urban Logistics Reit (LON:SHED) (£677m) | 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] | |
| 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) | Customer is a well-established Spanish cement producer. Revenue recognised in FY26. | ||
Aquila European Renewables (LON:AERS) (£177m) | 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) | 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) | “...recent events could constitute an event of default under the terms of the Loan Notes.” | RED (Graham) [no section below] |
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.
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.
Disclaimer
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35 comments
On pensions, personally I think there should be more tax relief for investing in the UK. It's a crazy situation that uk citizens are getting up to 60 % tax relief for investing in the Magnificent 7, but only 30% for a Venture Capital Trust!
Just wanted to highlight that The Week Ahead has been published for next week:
https://www.stockopedia.com/co...
Ocean Wilsons Holdings (LON:OCN)
Special thanks to Graham for having a look at this.
Fair analysis as always.
All the best
RE: Urban Logistics Reit (LON:SHED)
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.
Hi Graham
The deal also means that current SHED holders get the as yet unannounced next dividend, expected at 4.35p, so I think the current price indicates the deal is likely to go through at roughly a 6% discount to NAV.
Londonmetric Property (LON:LMP) price has risen slightly today as well.
timarr
Thanks very much timarr, edited the table to reflect this.
Card Factory (LON:CARD) on day of trading announcement a few days ago, think share ended day 4.5% down then today on, no news (that I can see) share trading 6.5% up……..
Paul Scott commented after the TU that Card Factory (LON:CARD) is worh £1.50 in his opinion. I hold.
Impressed Paul’s words can impact a stock so much of a reasonable sized company!! I hold so am grateful for his positive impact!
Am pleased to hear Card Factory (LON:CARD) is going my way.
Cockney Rebel was also positive in his Substack note today
Another interesting acquisition by Brave Bison (LON:BBSN) announces, prompted by "press speculation". A completion announcement followed so it's done. I won't repeat all the info in the announcements save to say it's funded by it's cash pile, some debt (from a facility of up to £10m) as well as a placing (existing and new) and a strategic investment by the acquired company's founder. I like that last bit as it seems to suggest he's comfortable rolling over with BBSN paper. I'm also comfortable with some debt now, particularly as rates are falling.
No new broker notes/research yet but the fact it's completed suggests it was almost done and then started to leak, so hopefully there will be an update to forecasts shortly.
Brave Bison (LON:BBSN) is building credibility (IMO), and of course profits, with this purchase "increasing the enlarged Brave Bison pro-forma Adjusted EBITDA by 78% to £8.0 million".
Prior TP was 4.7p (Cavendish). This should nudge it higher.
I hold.
They haven't completed the acquisition of MiniMBA. Today's completion announcement is for the acquisition of the Fifth Group, which they previously announced in April. They just said today that they're in early stage discussions for purchase of MiniMBA.
apologies Jo (and all) - my mistake. The Mini MBA deal is in exclusive negs until 19 June, so this is not in fact nailed down.
Re. Rightmove, "over 80% of consumer time spent on UK property portals" - I wonder if people are as despaired as me, how dysfunctional the platform has become in recent months? Property searches eliciting random prices, like a £75k flat under a £3.75m mansion despite putting in specific criteria. It's a time-wasting jumbled up mess, I've been in touch with Rightmove support over, for two+ months - they acknowledge the problems but can't seem to resolve. On three separate devices hence nothing to do with one in particular. Also a communication to an agent via Rightmove over a viewing appointment did not get received. I have shifted to On The Market and on the basis of my recent Rightmove experience (also the support side) would not touch shares with bargepole.
Rejoice! After the trauma of recent months, including a plunge in valuations, and a period of sitting back and letting matters develop, my portfolio has moved into YTD positive territory today.
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Mello 2025. Downing and its dealings with small caps should come with a wealth, health and trust warning.
Ocean Wilsons Holdings (LON:OCN)
Today’s Announcement
Should be covered by the writers.
Thanks
As a holder of Ocean Wilsons Holdings (LON:OCN) I couldn't agree more . It would be useful for the team to look at the statement in this mornings announcement " At 31 March 2025, the investment portfolio was valued at US$321.2 million which represents US$9.08 (£7.03) per Ocean Wilsons' share.
In aggregate, including US$47.4 million of cash at the holding company level, this results in an implied net asset value per Ocean Wilsons' share of US$27.20 (£21.06). "
The shares are currently priced at £13. 30 so there is a bit of a mismatch between their valuation and the markets - opportunity or trap ? wouldn't mind Graham,s opinion on this
Ocean Wilsons Holdings (LON:OCN)
They should have a look at the sale
The net proceeds and the tender offer of about 7m shares
There is an easy 20% to be made offer the summer here.
I do not hold
All the best
There are lots of investment companies trading on seemingly permanent 30-50% discounts (mainly within the alternative and unlisted asset funds) so nothing remarkable in that respect.
The question here is what £OCN plan to do with the proceeds of the Ocean Wilsons' sale, which makes up around 60% of the NAV. Ideally they would return all of this to shareholders - this would represent almost the entire market cap and mean investors get the investment portfolio (worth £7.03 per share) almost for free.
So far, they've only pledged to return part of the proceeds to shareholders, so there is a danger they re-invest the rest back into their fairly lacklustre investment portfolio which I suspect is likely to remain on a hefty discount. It's a fairly complex one and I've not looked into it closely, so could well be missing something.
I have now looked at OCN, Fred/Yiannos!
B.P. Marsh & Partners (LON:BPM) - Secondary placing announced yesterday afternoon by Panmure on behalf of PSC UK (a 19.9% shareholder). Placing price launched at 630p and PSC are placing around 4.3% of BPM's stock. At the open this morning BPM's stock dropped to 640p. Be interesting to see where we end up at close of business today. I'm a holder and not selling.
One of the reasons Ive resisted investing in B.P. Marsh & Partners (LON:BPM) and other similar - although admittedly even bigger coys such as HALEON (LON:HLN) the SP can suffer when major shareholder sells down. Yes will be interesting to see how longer term things pan out - but frustrating that small investors not allowed to participate in buying at a discount
Interesting article in the FT today regarding a meeting with lead Govt business advisor Varun Chandra and a group of UK equity specialists and fund managers (including Andy Brough). They are pushing hard for a compulsory domestic equity allocation for British Pension funds, anything from 5% upwards.
Needless to say this would provide a much welcomed and needed shot in the arm for UK capital markets and a multitude of second order benefits.
Morning BO
Have been tried in other counties many years ago; in similar situations.
It’s a recipe for disaster.
All the best
Hi Yiannos. Do you have any info as to how this went wrong elsewhere? Maybe percentage bar too high or some other reason? Whilst instinctively not keen on the idea, I am interested to know more. Thanks.
Of course fund managers are pushing for this as it will make them richer - it's akin to asking a barber if you need a haircut (Warren Buffett quote)
I want my pension invested where it's going to make the best return, whether that's UK, US or Timbuktu.
Gov't needs to leave well alone.
Nice to see some sense here.
All the best
The state can’t afford to fund loss making net zero ideology so they want to nick it from our pensions and give it to the Crown Estate for more Chinese windmills.
They should try to make the market too good to resist, not force people to invest.
If we want to "encourage" people to invest, I would think about auto enrolment (with easy opt out) of some small % of earnings that goes directly into a shares ISA in a globally diversified fund with a larger UK holding than usual (maybe 25%). Might have similar success to the auto enrolment pension and start to sort out one of the fundamental problems (the lack of UK people compared to US that invest in equity)
I can see a lot of pushback and negative headlines if pension funds forced to invest in UK equities. Surely better to provide some sort of incentive/small tax advantage to encourage them. They also need to get rid of stamp duty on share purchases, but that's probably unlikely.
Isn't the fact that there is tax relief for money going into a pension and no tax taken whilst invested in the pension enough incentive ?
Goodmorning?!
All the best