LIVEDaily Stock Market Report (Mon 26th Oct 2026) - CCC, CGS, PLUS
Good morning! The main headlines at the moment are all to do with elections:
US: midterm elections on November 3rd are interacting with President Trump’s willingness to bomb Iran. He says it’s “getting to be decision time”.
Brazil: left-wing President Lula has won a fourth term. His opponent, Flávio Bolsonaro, says that the result should be annulled.
Israel: a general election is happening tomorrow. On Polymarket, Benjamin Netanyahu is predicted to have just a 26% chance of remaining Prime Minister.
Serbia: president Aleksandar Vučić has lost to a “student-led protest movement” in snap parliamentary elections.
With oil holding firm at $115 per barrel, the US election and how it impacts Trump’s willingness to negotiate with Iran is the one I’ll be looking at most closely.
Overnight market movements:
The FTSE is up 0.4% at 10,710
S&P 500 is unchanged at 7,630
Brent crude (December) is down 1.4% at $115.00/bbl
Gold is up 0.3% at $4,005oz
Bitcoin is down 0.5% at $80,000
Leaving it there for today, thank you! Spreadsheet accompanying this report: link.
Companies Reporting
Name (Mkt Cap) | RNS | Summary | Our view (Author) |
|---|---|---|---|
GSK (LON:GSK) (£77bn | SR80) | Positive Mo-Rez Phase Ib data in ovarian cancer & Jemperli data show 76% complete response rate | Positive data for Mo-Rez in platinum-resistant ovarian cancer, and positive interim results from the phase II trial evaluating Jemperli (dostarlimab) monotherapy as a standalone treatment approach in adults with rectal cancer. | |
Computacenter (LON:CCC) (£4.9bn | SR88) | Following the excellent performance in Q3 and a strong start to Q4, now expects adjusted profit before tax for FY 2026 to be no less than £425m (consensus £387.1m with a range of £380.8m to £395.3m). | AMBER/GREEN ↑ (Graham) | |
Airtel Mobile Commerce NV (LON:AMC) (£4.8bn | SR27) | Reiterates near-to-mid-term guidance. For FY’27, has guided to revenue growth of mid-20s% in constant currency, with underlying EBITDA margins expected to moderate by up to c.2 percentage points relative to FY’26. | ||
Man (LON:EMG) (£3.6bn | SR87) | Meiji Yasuda intends to increase its capital commitment to Man Group's investment strategies to JPY 200bn (approximately $1.25 billion), focused on Man Group's private credit capabilities. Meiji Yasuda and Man Group to co-develop products. Meiji Yasuda to consider acquiring an equity stake of approximately 5% in Man Group. | ||
Greatland Resources (LON:GGP) (£3.1bn | SR85) | September quarter production of 70,131oz Au and 2,927t Cu at an AISC of $2,925/oz Au. On track for FY27 full year production guidance of 260,000 – 300,000oz Au at an AISC of $2,900 – $3,330/oz Au. | ||
Plus500 (LON:PLUS) (£2.3bn | SR68) | FY 2026 revenue and EBITDA expected to be ahead of current market expectations. Cash $775m. Q3 new customer growth of 27% year-on-year, revenue +11%. | GREEN ↑ (Graham) | |
HUTCHMED (China) (LON:HCM) (£1.88bn | SR31) | ORPATHYS® plus TAGRISSO® reduced the risk of disease progression or death by 45% and the risk of death by 32% in MET-driven EGFR-mutated lung cancer after progression on TAGRISSO®. | ||
Molten Ventures (LON:GROW) (£1.16bn | SR75) | NAV per share expected to be up 14% to circa 869p. Cash £76m. Fair value uplift generated by strong performance in the Core Portfolio, primarily driven by ICEYE, and Revolut, and the Fund of Funds programme. | ||
Auction Technology (LON:ATG) (£586m | SR49) | FitzWalter Capital own 27.2% of ATG. They wish to remove Scott Forbes as a director and appoint Richard Campbell-Breeden in his place. They want a comprehensive strategic review, including consideration of a full competitive sale process. | ||
Restore (LON:RST) (£410m | SR57) | New CFO joining from Victrex. Begins January 2027. Two new NEDs. | ||
Avacta (LON:AVCT) (£310m | SR3) | Updated data from the ongoing Phase 1a/1b trial of faridoxorubicin (AVA6000) with median progression-free survival of 11.4 months in a defined subset of patients with salivary gland cancer, compared with published historical benchmarks of 6-6.7 months. | ||
Big Technologies (LON:BIG) (£273m | SR66) | BIG was served with Particulars of Claim on Friday 23 October 2026. The defamation claim is in respect of allegations of forgery made by the BIG against Sara Murray in the RNS dated 12 September 2025. | ||
Puretech Health (LON:PRTC) (£270m | SR54) | As previously disclosed, topline results of the Phase 1b clinical trial of LYT-200 showed encouraging clinical activity and favorable safety in a heavily pretreated patient population. The oral presentation at ESMO provided further detail on the depth of responses observed. | ||
CLS Holdings (LON:CLI) (£189m | SR25) | Following recent changes in CLI's share ownership, CLI no longer meets the requirement to not be a "close company" and accordingly expects to exit the REIT regime on 31 December 2026. | ||
Literacy Capital (LON:BOOK) (£172m | SR N/A) | Capital allocation policy & Quarterly trading update and NAV announcement | NAV £271m, equating to NAV per share of 450.5p. The 4.7% decrease in NAV was driven by Cubo Work (disposed). The focus to generate cash from the portfolio and to reduce borrowings is expected to continue for the remainder of 2026 and into 2027. The share price is currently considered to be at an excessive discount to reported NAV; buybacks, tenders offers and B share schemes may be used to manage this discount. | |
Pensana (LON:PRE) (£129m | SR7) | The proposed Ozango equity financing is expected to be in the range of US$75-90 million of which Cascade expects to deploy a significant tranche within the next 14 days. Commissioning is planned for January 2028 with conditional deployment of equity shortly, and binding offtakes and debt approvals by February 2027, for full production by September 2028. | ||
Castings (LON:CGS) (£120m | SR91) | Whilst the order book remains strong across the group, the third-party power supply issue at the William Lee site continued to impact results in the first half of the year. Whilst revenue expectations remain in line with market consensus, with production arrears not yet resolved the Board are reducing its expectations for adjusted profit before tax for FY27 to a level broadly consistent with the profit in the previous year. | PROFIT WARNING (AMBER/GREEN=) (Graham) | |
Bioventix (LON:BVXP) (£105m | SR66) | Revenue down 0.8% to £13.0 million. Profit before tax up 1% to £10.2 million. "We expect that the year to 30 June 2027 will follow a similar pattern to this year. Revenue generation from our historic core business will be subject to headwinds and be replaced and increasingly augmented by sales from our growing Tau and neurology portfolio of antibodies." | ||
Software Circle (LON:SFT) (£70m | SR30) | Max cost of £4.5m will be paid in cash. £2.6m is paid upfront. Gintech provides specialist practice management software to the UK private healthcare market. | ||
Panthera Resources (LON:PAT) (£61m | SR26) | US$1.58 billion claim against India. India filed its Rejoinder on Merits and Principles of Compensation on 23 October 2026, in line with the procedural calendar. This completes the written phase of Phase One. | ||
Orosur Mining (LON:OMI) (£49m | SR5) | As at the date of these results and including the funds raised in the private placement, OMI had a cash balance of US$16.8m. The company will focus on Colombia and Argentina whilst also looking for new opportunities in South America. No revenues in the quarter, net loss for continuing operations $545k. | ||
One Health (LON:OHGR) (£40m | SR81) | Revenue +17%. Underlying EBITDA for H1 27 is expected to be ahead of the £1.18 million reported for H1 FY26. The Group remains on track to deliver expected revenue growth and underlying EBITDA for FY27, both in line with current market expectations | ||
Ferro-Alloy Resources (LON:FAR) (£31m | SR4) | New CEO appointed with immediate effect. Outgoing CEO becomes Non-Executive Deputy Chairman with immediate effect. | ||
Quadrise (LON:QED) (£20m | SR6) | Loss after tax £4.2m. Cash £2.1m (June 2026), with £1.6m raised in July 2026. Cash runway expected to extend to September 2027. Strategic Review launched to identify and assess strategic, corporate, commercial and financing options, including potential partnerships. | ||
Angus Energy (LON:ANGS) (£15m | SR35) | Saltfleetby production of 467 million standard cubic feet of natural gas and 8,281 barrels of gas condensate during the quarter, with production reflecting the planned annual maintenance shutdown and subsurface data acquisition programme. Oustanding borrowings under senior debt facility reduced to £21.5 million as at 30 September 2026. | ||
Energypathways (LON:EPP) (£15m | SR1) | Signed Heads of Terms to purchase land at Barrow-in-Furness, Cumbria, for its nationally significant MESH project. The commercial terms of the purchase are confidential. |
Analyst notes
In September, we reverted to a neutral stance on Computacenter. Today, with a slightly cheaper share price of about £50, and another earnings upgrade, I think it makes sense for us to get back onto a moderately positve stance here. The earnings multiple is still rather expensive for Computacenter; we need to be aware that any weakness in the AI/data`centre boom could feed through rather quickly, which would make the stock look significantly overvalued. For now, however, there are few signs of the boom slowing down.
This is a serious profit warning in percentage terms: the new profit forecast is 30% lower than the prior forecast. However, the share price has barely moved and I agree with this. The reason for the profit warning has nothing to do with demand, or competition, or anything else that might be central to the investment case. Instead, it's a well-defined issue at a particular site, that is already in the past. Forecasts for FY28 and FY29 are unchanged and I am similarly going to leave our stance here unchanged (moderately positive).
I cooled our stance on Plus500 in July but am happy to go back to a fully positive stance on the company today. That July update included a miss against H1 expectations, which was an important reason for my caution then. However, zoom out a little and the overall trend in forecasts remains positive. The market cap for Plus500 today is also noticeably lower than it was in July, and the earnings multiple is back at modest levels, without making any adjustment for the company's enormous cash balance.
Disclaimer
This is not financial advice. Our content is intended to be used and must be used for information and education purposes only. Please read our disclaimer and terms and conditions to understand our obligations.
42 comments
TEK4 (LON:TEK4) An interesting and successful London listing today. Looks to be highly promising.
fair comment Graham, one risk not mentioned is if this has incovenienced their customers and they might go elewhere, reputational damage etc.
Thank you for this coverage Graham, I like what CGS do, on renewables too now, and how they report. We also like their dividend record so we'll continue to hold and wait for better times.
SIG (LON:SHI) Does anyone have any thoughts on why SIG has dropped by 9.4% this morning? (Sheffield Insulation Group)
The flippant response would be, "does anyone care?" An unrelentingly awful business with terrible margins, persistent losses and rising debt. The equity is valued as option money and as though it needs yet another rescue rights issue. I only mention all of this because Stocko puzzlingly has SIG (LON:SHI) classified as a 'super stock'. I would be interested in why this anomaly is happening on the stock report?
It does seem a strange.
But as Ed has shown the basket case for super stocks/high rank pays off so something must be correct in there over the majority. Phil H also has a system based the profitability of VM (a 99 score here) and the benefit that stocko ranks give us non experts a strong sign to go on. Both Phil and Ed make very good arguments for simply following a rank strategy.
Having said that it would be amazingly helpful if someone who knows the secret sauce could go into the stock report for this today and give some insight as to why it is where it is. For instance It has a Value rating of 91, yet the P/E says n/a, That seems very odd.
As a non expert screening for ranks I would get SIG (LON:SHI) on many a screener but the second I click on the report I'd be put off by the lack of Value and Growth numbers (literally all 3. n.a) and the sea of red. Then close the report and scratch my head thinking how is that ranked so high.
Not having a go at all, just wanting to learn and have more confidence that the ranks are indeed backed by solid numbers. Or maybe I am just missing something very obvious (it may well be the case). Maybe we could have an Ed Webinar on such anomalies in the future.
SIG (LON:SHI)
so something must be correct in there over the majority
or the stockranks might be abjectly failing at assessing the business metric here - other than the free cashflow and the book value per share i cant see any attractions to owning this share based on current numbers.
ref free free cashflow - is that being postive of much use if its churning out accounting losses - possibly but seems very flakey grounds for being positive.
ref book value - we are talking about huge numbers here all round - so that value of the assets is dwarved in comparison to the payables and debt it has on the credit side of the balance sheet - in any sort of liquidation type scenario here i would presume the creditors pretty much own this business if anything were to go wrong and that shareholders would get didly squat.
perhaps stocky can see turnaround here thats not apparent in the numbers ?
i would be interested to here then logioc behind the high ranking here as it looks plain nonsense to me.
Note i would say then marekt cap is such here that if it can get turnaround going the shareprice could do very well
per the update 04/08/2026 - they did talk the talk ref the future so perhaps there are some green shoots here that arent showing up in the number i am looking at ? i guess its easier to make promises about 1 and 2 years into the future rather than the right here right now !
o Significant management-controlled self-help potential underpinning Vision 2030 targets:
- £50m run-rate operating profit improvement targeted by mid 2028
- At least £100m cash generation by the end of 2027
- 3% - 5% operating margin through the cycle
- Leverage less than 3.0x net debt to EBITDA
i do fail to understand how any company with such large consistent turnover cant get its house in order for so long that its not making some sort of fair margins at bottom line - its strikes me that there has been no basic discipline here ref ensuring the number one basic ref margins that can deliver profit is sorted. Hey ho Volex was sim,ilar back in the day so one does have to belive at some stage soemone may say - no point having sales if they dont genrate reasonable margin.
I looked at this when the Stocko rating was upgraded and decided to be a bad samaritan and walk around the other side. The following was the comment i noted
SIG plc (LSE:SHI) reported first-half revenue of £1.29 billion, slightly below the previous year, as like-for-like sales declined 1.5% against a backdrop of subdued construction activity and poor weather during the opening quarter. Gross margin eased to 23.9%, while underlying operating profit fell to £10.5 million. The company also reported a wider underlying pre-tax loss and net debt of £532 million.
Despite the difficult trading environment, SIG said every business division returned to profitability during the period. The group also maintained liquidity of £154 million and reported market share gains in several key regions, including the UK roofing market, Poland and the Benelux countries, reflecting continued progress in its operational performance.
With construction markets expected to remain challenging through 2027, SIG is stepping up its Vision 2030 transformation programme. The company is targeting a £50 million annualised improvement in operating profit by the middle of 2028 and aims to generate at least £100 million in cash by the end of 2027. These initiatives are intended to reduce leverage to below 3.0x and support long-term operating margins of between 3% and 5%.
The transformation plan focuses on procurement efficiencies, streamlining back-office operations, optimising the distribution network and branch footprint, simplifying the product portfolio and deploying AI-powered tools to improve pricing, inventory management and route planning. The strategy also includes updated sustainability objectives and continued investment in reducing fleet emissions.
SIG’s investment outlook remains constrained by weak underlying fundamentals, including declining revenue, continued net losses and elevated debt levels, although recent free cash flow has shown improvement. Technical indicators are broadly neutral with only limited signs of momentum, while valuation remains under pressure due to negative earnings and the absence of dividend support.
Not sure given past disasters taking any of this on trust is a risk one feels worth taking. Admitedly I note Kesterton has been buying shares and as CEO designate you could see this a key indicator. You would have to feel that there was something revolutionary about Vision 30 to invest in my opinion. I think Marshalls likely a better place but DYOR
Thanks for the reply. I'd hope it isn't something that is not in the numbers that stocko can see (excuse the double negative there). As that would really take away from the ranks system in my eyes.
SIG (LON:SHI)
As that would really take away from the ranks system in my eyes.
i dont think anyone pretends the rankings are perfect though so its buyer beware aint it - i think its always been said that certain business types the ranks can just come out plain weird (perhaps banks and insurance companies). if one takes a basket of 10 and there are 8 super duper companies and 2 half duds well thats better than 50/50 chance - so there is always room for a well rated stock being a dud imho.
so i dont want to speak for ed but thats perhaps a question for him why this company is ranked so high when it seems to have close to nil redeeeming features other than promise of better - i for one would never presume that every high stock rank company is good company - just like i would never presume that every low ranked company now isnt just on the cusp of being good and that being reflectedx soon in stock ranks. - note if they can hit near term targets and add £50 mill to the bottom line well that would be a different kettle of fish - and thats kinda what they are promising (just not yet) so i aint saying its a complete basket case -
note it does come with the warning "speculative" stock - which is the second bottom category and also teh bankrupotcy risk is in the red zone - so you are kinda ignoring then obvious wet fish face slaps if you are defaulting to ignoring these two warnings.
stocky themselves gives some added warnings here that they kinda see high share price volatility as a risk factor - that kinds suggests low volatility is a good trait - it looks like the share price has raelly low volatility which stocky sees as a positive - whereas i simply look at this as beinga shit company now shit company the year before and a shit company the year before that - so consistently shit - perhaps trending less shit well thats the best we can say.
per stocky
The use of volatility as risk is somewhat controversial, and criticised by many famous value investors who believe that ’risk is not volatility, it is the likelihood of capital loss’.
While this is certainly the case, most value investors have struggled to quantify the likelihood of capital loss, and price volatility remains one of the best predictors of future financial risk.
We do recommend assessing the full suite of financial risk indicators on Stockopedia including measures of Bankruptcy Risk, Earnings Manipulation Risk and other Quality factors.
Hi Jay,
You could consider adding balance sheet strength tests to your screening.
Here are some examples which SIG (LON:SHI) fails. I picked up these ideas from former analyst here Paul Scott.
I hope that helps
Phil
Thanks Phil that is very helpful. Definitely something to think about adding in.
Thank you Sparkler. This is a stock that I've been looking at for a few months, but as you say there is little indication that the fundimentals of the buisness are improving. What I find puzzling is that in early Summer of this year the Stock Rank was in the early 50's and this has rocketed to 94 in recent weeks for no apparent reason? The company has been around since the 1950's, and it would have been thought, that with the exponential increase in the use of insulating products in the construction industry in recent years, they would have been in an good position to increase their margins & profitability. Although there is a lot of 'doom and gloom' surrounding the housebuilding sector in the uk it is a fact that new build housing starts have increased by 14% from 1Q2025 to 1Q2026 (Growth has been aneamic since Covid & of course these starts must result in consistent completions & sales) Lets hope that SIG's Vision 2030 is a little more than talk.
SIG (LON:SHI)
i suspect the main issue the compoany has here is that they are on lif support - sometimes when you are on life support you can do nothing other than the bare minimum.
Note clearing off slow selling inventory lines would seem an obvious avenue - but if you have to book a loss to do that well you then have more sketchy calcs ref your banking renewal requirements.
perhaps the lead times are such that they need to somewhat gamble to ensure they have the volume to sell when customer may need it - so they might have been carry excess stock in the hope they could sell at topwhack margins or buying in at fixed forward prices that might have gone against them.
overall though just seems to me like they can budget at right price to have decent margins.
I must admit it used to be somewhat brutal buisness - i remember guy i know who used to set SIG against Encon back in the day just to pimp out year end rebates - and that could easily double the their ye profit by getting recent rebate in place. So it was kinda feast of famine taking no turnover or highn turover at lowish margins whats the lesseer of two evils ?- its like people who leave sky tv after fixed period and only come back when sky start begging and get the monthly price below half what tehn normal price is - they are up against savvy hosuebuilders and then like who would screw their own family members over for 1% of a large number. with so many years in the business getting the basic right should be water ofa ducks back ! -
perhaps chunky finance costs mean its just a dead business model if they are competing against competitor who doesnt have the finance costs (or other high fixed costs) they do ? not sure if some of the finance costs are actually rent in disguise or not ? - just look at Headlam to see what happens when your main direct competitor pounds you into obvlivion sometimes thats the issue that they simply cant change more as everyone would go to competitor B who can charge lower price and not have same issues.
Hi rmillaree, thank you for your insightful comments above. Yes, construction is a brutal sector & the extremely low margins result in heavy negotiations between suppliers and their clients. I found it interesting to see that Simon Kesterton the current CFO of SIG, is to be their CEO from the 1st May 2027. Simon was the CFO of Kier's for several years until 2025 and is an industry 'big hitter' . Kier was in the doldrums back in 2019, and in recent years they have suceeded in turning their figures around and getting back on track. Kier is a company that I have always admired, and their turnaround was in part due to the sucess of Simon.
SIG (LON:SHI)
I found it interesting to see that Simon Kesterton the current CFO of SIG, is to be their CEO from the 1st May 2027. Simon was the CFO of Kier's for several years until 2025 and is an industry 'big hitter'
Yep if they have a top notch person in charge / as cfo thats potentially a huge boost - albeit what do they say about crap business and good head honcho being put together ? have all man united managers been crapola since fergie left ? or is it simply crap business structurally compared to club like brighton?
"Seagulls"!!
Dont get me started on seagulls - i live by the sea :(
One Health (LON:OHGR) I have this on my watch list as it has potential to be very good. The update highlights yet another NHS re-organisation which will likely see some impact. The next event is opening of the first small private operating unit which is key to future growth and there is clear demand for this
My view is currently rather expensively rated for what it has achieved but it is my idea of quality owner managed business.
Airtel Mobile Commerce NV (LON:AMC) these numbers look decent, with a well covered dividend yield. Any thoughts welcome as to why so poorly rated by Stocko? Unless it’s just the algorithm lacking data due to it being a recent new issue?
Something in my memory says that it takes a while for newly listed companies to move up the stock rankings (if it is deserved). I think the lack of historical data counts against it at this stage.
thanks Ted. Very useful. Graham if you or the Stocko team are reading this it would be good to get more background on this. I have held the parent Airtel Africa (LON:AAF) for a couple of years as I like the growth story and the demographics in the region, but would welcome the team’s thoughts on the newly listed subsidiary
Spmarriott, I'll see what we can do about covering this! Thanks.
Much appreciated Graham
Have you looked at the list of major shareholders - According to Stocko 91.35% - leaving so little to the rest of the Mkt, I would be concerned.
Bioventix (LON:BVXP) I hold
Results for year ended 6/26 show the resilience of this company. It's not an easy business to understand because of the deep medical science behind it and the long lead times involved. Nevertheless good progress is being made in exciting new fields where techniques for the detection of neurological conditions like Alzheimers are beginning to have an impact.
The company says "Conclusion and Outlook
This year has been particularly noteworthy as our historic core business has faced some challenges in downstream markets, particularly in China. Despite these headwinds, we have delivered a marginally better set of results whilst maintaining dividend levels and a healthy cash balance, demonstrating the robustness of the business.
Meanwhile, our research and commercialisation of antibodies in the field of neurology have yielded significant progress. The vision of our customers for growth in this exciting field together with the performance of our antibodies at many of our customers points to future success in this area.
We expect that the year to 30 June 2027 will follow a similar pattern to this year. Revenue generation from our historic core business will be subject to headwinds and be replaced and increasingly augmented by sales from our growing Tau and neurology portfolio of antibodies. Longer term we expect the neurology portfolio to deliver growth to offset the challenges that our legacy antibodies will continue to face. The timing of that growth is difficult to forecast but our level of confidence in the opportunity is undiminished."
A maintained dividend is useful too. Hopefully the team will have time to cover this popular share.
I'd rate Bioventix (LON:BVXP) as a hold at today's share price. (I hold btw). With a around £8M cashflow and virtually no capex it trades with a free cashlow yield of 7.7%.
Can't say I understand the monoclonal anti-body market. The overall impression is the Company has a solid moat due to long regulatory lead times and (possibly?) patents. Despite this there is pressure from China's increasingly sophisticated pharma industry. That's on the long established sales stream which underpin a £105m market cap.
The game changer would be if the Tau antibody development turns into an a regulatory approved test. I recall that was exactly the same position as this time last year, and the Company might be repeating it a a year's time. The positive thing compared to other biotechs is very low chance of share dilution to fund ongoing R&D. The well established royalty revenue stream finances everything. There's downside if no major new products are successfully developed and (assuming no takeover) the only value is the NPV from legacy sales.
Mark - I guess you are right - it is a ‘hold’ but maybe for a variety of reasons, though todays update imho was far long and that makes me nervous. However, this is like no other company on the Mkt - at just £100m it could easily be gobbled up before breakfast by so many multi million companies and its research could suddenly hit the jackpot and take off.
Eagle Eye Solutions (LON:EYE) I hold . Share buy back announced today.
Could anyone with a lot more understanding of these matters than I provide some explanation of why businesses do these buy backs and in particular, why they do them at a particular time please ?
I get that their share price has fallen by 10% over the last month , but it is still 40% up over the last year.
Wouldn’t a growing company be better off using the cash to invest in its business or, failing that, paying dividends to their shareholders ?
Many thanks for your help
Re: Eagle Eye
"Could anyone with a lot more understanding of these matters than I provide some explanation of why businesses do these buy backs and in particular, why they do them at a particular time please ?"
I am not an expert in buy backs, they do however occur in different guises. For Eagle Eye the reason is given as..
"All shares acquired under the Buyback Programme will be held in treasury and are expected to be used, inter alia, to satisfy future obligations arising under Eagle Eye's staff share schemes, thus partially reducing future dilution for shareholders, and to provide flexibility to reissue the treasury shares if required to satisfy investor demand."
A key point here is that the shares are not being cancelled but held in treasury for the reasons stated. Is there any reason to doubt this explanation?
No position
Thanks intuitive
In reply to Lochinver and intuitive6191 re Eagle Eye Solutions (LON:EYE) and share buy backs:
From a dilution perspective, it doesn't make any difference if bought back shares are held in treasury or cancelled. Either way they drop out of the outstanding share count (issued - treasury), on the basis that it doesn't make sense for a company to own shares in itself.
If a company has 100m shares in issue and then then 10m of those shares are bought back: if cancelled, 90m in issue - 0m treasury = 90m outstanding; if held in treasury, 100m in issue - 10m in treasury = 90m outstanding. Either way this is anti-dilutive, as the outstanding stock count falls from 100m to 90m.
From a practical perspective, it can make a difference if bought back shares are held in treasury or cancelled. Treasury shares are quicker/easier to re-issue to satisfy employee share-based payment schemes (or if the company wants to raise equity capital again) rather than having to issue completely new shares from scratch. But if the 10m are re-issued, the outstanding stock count will go back up from 90m to 100m (100m issued - 0m treasury), which is obviously dilutive.
Lochinver, I agree it would be far better for a growing company to retain and reinvest equity capital rather than returning it to shareholders. However, if they do have surplus equity capital to return: if they believe the share price is above fair value, better to pay a dividend and avoid giving away value to departing shareholders; if they believe the share price is below fair value, better to buy back as should be beneficial to remaining shareholders.
This is before one gets into discussions about: the tax position of different shareholders (i.e. preference for gains (buy backs) vs income (dividends)); the desire of managements to increase EPS (buybacks do, dividends don't); and the simple fact that buybacks (more of a US phenomenon?) have become a more fashionable thing to do over at least the last decade or two.
This is not intended to be a comprehensive answer and I'm sure there are other issues that I have not mentioned but I hope this helps a bit.
Best,
Neil2025
Worth noting too that larger companies often fund their executive share awards through Employee Benefit Trusts, so avoiding the issues with holding and reissuing from Treasury (because EBTs are separate legal entities).
The less prudent do neither but fund their share awards through options and by creating new shares if/when they vest.
Also, in keeping with most other companies, Eagle Eye have chosen to pay executives partly in shares rather than in cash.
Thank you Neil - very helpful indeed
It's still Airtel Mobile Commerce NV (LON:AMC) not AMC Entertainment Holdings (NYQ:AMC) ...
On a quick scan the results look OK, the scale of dividend is a bit of a surprise, but probably reflects the need of the parent company for cash.
timarr
Airtel Mobile Commerce NV (LON:AMC)
Hi Timarr
I haven't looked at the RNS this morning, but on the dividend I recall reading in the IPO prospectus that the plan was to set this at 80% of profits.
A
One Health Group (OHGR) - Another re assuring update with all seeming to be going to plan. In a niche spot given the ongoing backlog in patients waiting to be seen and successive governments inability to resolve the issue. New hub to open next year to drive growth further and are also looking at another potential hub. A great long term hold in a sector where there is always going to be demand. A P/E of around 21 is slightly high but with the growth planned doesn't seem to onerous in my opinion plus it pays a 2% divi will we wait. Not bad for a growth stock. I hold.
We're long term CGS holders now braced for a momentum drop after today's mild profit warning due to lagging production arrears at their William Lee site. I notice Ruffers dumped shares last week just ahead of the TU. We'll hold.
I'm out. Don't like profit warnings. Oneward and (hopefully) upward
Morning Graham
I would be interested in your thoughts on Auction Technology (LON:ATG) where a board battle and activist shareholder is trying to stimulate more value recognition in the share price. As a holder I certainly would like to see an uplift but don't necessarily want to see it becoming another US listing.
Also any comment on Computacenter (LON:CCC) who appear to have up graded 2026 profits by nearly 20%. Hopefully the share-price will reflect a good deal of this!
In the last few weeks every positive announcement in my portfolio has seen a share price fall, so I am not getting too excited.
best wishes
Greyster
I am also a holder of Auction Technology (LON:ATG) and this is shaping up to be a major distraction for the new CEO who i have some faith in. Any views welcome. I will not be voting to support the Yankees
This isn't a forum for politics but I enjoy your initial roundups Graham. Fwiw, I agree on the renewed Qatari negotiations with Iran, Trump needs a deal. I also welcome news that Trump won't, e.g, The Student List and Lula,