Daily Stock Market Report (Tue 13th Oct 2026) - CAV, GNC, IPX, MARS, WTB

Good morning! There is no one major overnight news story to report, so let’s just bring you a few of the headlines:

• Saudi vs Houthis: Saudi has intercepted more missiles launched by the Houthis in Yemen.

• UK economy: the IMF has upgraded its forecast for UK economic growth this year from 1% to 1.3%. Growth is then expected to moderate in 2027.

• The well-known dating app Bumble (NSQ:BMBL) (listed on the NASDAQ) has received takeover interest, according to the Wall Street Journal. Its shares rose 50% yesterday.

Now let's take a look at today's UK company news…

Overnight market movements:

• The FTSE is up 0.3% at 10,675

• S&P 500 is down 0.1% at 7,800

• Brent crude (December) is down 1.1% at $105.50/bbl

• Gold is up 0.5% at $4,190oz

• Bitcoin is up 0.6% at $83,500

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Ed Sheldon joins me today.
All done for today, thank you.

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Companies Reporting

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Graham's Section

Cavendish (LON:CAV)

Down 16% at 6.97p (£27m) - Half Year Trading Update - Graham - AMBER ↓

This is not a great update:

Against the current market backdrop of increased macroeconomic challenges, the Group revenue for the period is expected to be about £22.8m.

That level of revenue leaves the company with another £37m to generate in H2, if it's to meet market expectations of £60m. It requires an H1:H2 split of 38:62.

It's also a significant drop-off from prior years: H1 revenue was £28.5m last year, and £27.7m the year before that.

For some further detail, they tell us that the revenue mix was "balanced across all service lines". And they've been active in the LSE's new Private Securities Market - share auctions for private companies.

Outlook: they are able to promise very little.

Despite challenging conditions in the year to date, we are increasingly seeing good prospects being generated from several areas of targeted investment in the prior periods, including our business outside London. We have a healthy pipeline of both public and private transactions, including IPOs. However, as we have seen in the first half of the year, completion timetables, and therefore revenue visibility, remain difficult to predict. Against this backdrop, we will continue to exercise strict cost controls.

Graham's view

Revenues can be very lumpy, so I'm not going to rule out the possibility of a really strong H2 that brings full-year revenues close to that £60m forecast.

At the same time, it's hard to build an investment thesis on numbers that seem to be totally unpredictable, and also appear to be going in the wrong direction at the moment.

This is a stock I've championed in the past and I must admit that I'm starting to question myself.

On the bright side, I do expect the balance sheet to remain very strong and for cash to continue to cover a large chunk of the market cap. At the full-year results, the cash balance was £19m with no debt, and tangible equity was £25m.

The company has said that it will "exercise strict cost controls" in light of the poor visibility it enjoys right now, and this should help to protect the cash balance.

And so with a market cap of just £27m today, I still think this makes for an interesting value investment.

But if I'm honest, the wait for a rebound in IPO activity has taken much longer than I expected. And I don't see signs of anything changing in 2027. There has been a little bit of activity on the LSE's main market in recent times, but there has been almost nothing on AIM (the market where Cavendish are strongest).

I'll take us down to neutral today on the grounds that the company is now likely to miss full-year expectations. Pre-tax profits last year were £1.5m on £56.9m of revenues, and it seems to me that Cavendish will be doing well to repeat that this year.

So in summary, the main attraction here is the balance sheet. If a larger bank were to buy Cavendish, I'd expect them to pay a nice premium to balance sheet value (£19m cash/£25m tangible equity). But in the absence of a takeover, the case for investing here is unfortunately looking weaker and weaker. My optimism that AIM might see a rebound within the space of a few years was misplaced.

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Impax Asset Management (LON:IPX)

Down 12% at 89.6p (£114m) - Q4 AUM update - Graham - AMBER ↓

[At the time of publication, Graham has a long position in IPX.]

We had been AMBER/RED on this (e.g. here), until I got excited at the Q3 update in July, when I switched up to AMBER/GREEN. In hindsight, it looks like I read too much into the improved Q3 outflows

Outflows in Q4 have soared to £2.4 billion. This compares with £2 billion in Q2, or only £1 billion if we exclude the loss of an investment trust to the Saba campaign.

When I looked at that Q3 update, I read it as a £1 billion outflow. Given that the last-seen cash balance of £46m was already covering a decent chunk of the market cap, almost putting this stock in the deep value category, I was happy to take a more optimistic point of view.

But now the quarterly outflows have increased to over £2 billion again, and this time they aren't even masked by positive market movements.

Let's hear from CEO Ian Simm (emphasis added by me):

"The net outflows for the quarter were concentrated in actively managed listed equities (~75% of AUM) and principally reflect the 'lag effect' of clients responding to the previous weaker investment performance of some strategies.

"Between 2023 and 2025 these strategies were challenged by an equities market dominated by a narrow part of the technology sector and our thematic strategies' investment opportunities were out of favour.

"However, since the start of 2026 there has been a significant change in equities markets, with environmental themes in particular performing more strongly, as investors reconsider areas such as energy security, resource efficiency and electrification, particularly in the context of the build out of AI... As our performance track record strengthens, we expect to see our own flows improve.

Graham's view

The quarterly net outflow is 10% of starting AUM, which is very poor no matter which way you look at it.

For the financial year as a whole, net outflows (£7.8 billion) are an incredible 30% of starting AUM. And it's not as outflows were positive before then, either.

Forecasts at Equity Development have been cut due to the disappointing AUM news. They leave FY26 profit forecasts unchanged, but they reduce the FY27 net income forecast by 14% to £10.8m, and the adjusted EPS figure by 12% to 10.4p.

I'm cutting our stance on this today to neutral. However, I don't want to get any more negative than that, due to the considerable asset backing here.

Impax had cash reserves of £46m as of March 2026. Equity Development have year-end net cash forecasts of c. £61-62m for the next two years.

So in my view, at a market cap of £114m, this is not all that far away from deep value territory, from a balance sheet perspective.

I'd also like to emphasise that the company is still profitable with an expected after-tax profit margin of 8-10% over the next two years.

So there's a lot to dislike - front and centre in that regard being the very heavy outflows. I don't think there's been a quarterly inflow here since soime time in 2022. Returns have not been good enough and investors have lost interest as sustainability has gone out of fashion in favour of AI and other technology trends.

But everything has a price and I find it hard to believe that Impax is undervalued at this level. Hopefully Ian Simm will prove to be correct, and flows will improve with the help of recent strong fund performance. As that is just a hypothesis at this point, I think a neutral stance is fair.

The destruction of the share price is quite a sight to behold:

I turned positive on this too soon, and added a small starter position to my portfolio to help focus my attention on it. Thankfully, I've not been tempted to buy any more - and I have no intention of doing so in the near-term!

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Edward's Section

Greencore (LON:GNC)

Up 1% at 265p (£2.1bn) - Q4 Trading Update - Ed S - AMBER/GREEN =

UK convenience food manufacturer Greencore has today provided a trading update for the quarter ended 25 September and there are numerous positives:

Trading performance:

• Q4 pro forma revenue increased 4.5% to £1,036m, reflecting strong volume growth and recovery of labour, packaging, and certain raw materials inflation.

• Manufactured pro forma volume growth in Q4 accelerated to 2.1%, ahead of the wider grocery market at 0.5%, with chilled categories including salads, dips, quiche and sandwiches performing strongly.

• Innovation remained an important contributor to growth with 167 new products launched during Q4.

• Underlying profit momentum was ahead of expectations, driven by a combination of volume growth and continued margin improvement.

• Synergy delivery from the Bakkavor acquisition has continued to progress strongly.

• FY26 pro forma revenue grew 3.6% to £3,378m.

• FY26 manufactured volume grew 1.1%, ahead of the wider market at 0.5%.

• Net debt (excluding lease liabilities) is expected to be approximately £600m at FY26 (net debt/adjusted EBITDA of approx. 1.8x versus medium-term target: 1-1.5x).

“Greencore has had a monumental year, and we finished it with a strong performance in Q4. We grew volume ahead of the market, drove strong profit growth and we continue to make strides in our integration with Bakkavor. That performance means we are in a position to further upgrade our full year guidance.”

Outlook:

• Now anticipates FY26 adjusted operating profit for continuing operations (UK business) to be approximately £248m, ahead of current market expectations and previously raised guidance.

• Q1 FY27 trading has started positively, with volume momentum continuing from Q4 FY26.

• Has had further success cross-selling its new categories into existing customers and has won a further 75bp of annualised revenue growth (c.£30m of annualised revenue) across salads, ready meals, dips and breads, which will launch across Q2 and Q3 FY27.

• The group continues to progress the sale of its US business, which has been treated as a discontinued operation and held for sale asset. The US business continues to trade positively and in line with expectations.

“We have real momentum in our business and Greencore has never been in a stronger place. Customers want to do more with us and we are seeing encouraging progress from cross-selling categories across our expanded customer base.”

Notes worth highlighting:

• Current market consensus for FY26 adjusted operating profit for continuing operations (UK business only) is £238m (with a range of £236-241m), which was compiled from 8 covering analysts.

• Previous guidance, provided as part of the Q3 trading update, was FY26 adjusted operating profit of £234-242m (continuing operations, UK business only).

• Pro forma growth reflects the new Greencore: Q4 growth reflects Greencore and Bakkavor for the entire period (both current and previous year) and removes the Bristol facility (which was disposed in January 2026) from the previous period; 12-month growth reflects Greencore 12 months, Bakkavor since acquisition and Bristol up to date of disposal (both current/prior year).

Ed’s view:

This is a sound update, with solid revenue growth in Q4 and news of better-than-expected adjusted operating profit for FY26. What jumps out to me is the language from management – the company had a ‘monumental’ year, currently has ‘real momentum’, and has ‘never been in a stronger place’.

What’s interesting is that Greencore sports a StockRank of just 42 at the moment. It seems the StockRank took a huge hit in late May when the company’s interim results led to a sharp drop in the share price.

I suspect that it’s only a matter of time until we get a material jump in the StockRank. Because the company clearly has operational momentum at the moment (there was another positive update back in July in which guidance was raised) – and earnings forecasts are rising:

Meanwhile, it looks relatively cheap on a forward-looking P/E ratio of 11. Additionally, the share price is rising and is now back above both the 50-day and 200-day moving averages.

Looking beyond today’s update and the StockRank, one thing that is worth highlighting here is insider buying. When the stock fell sharply in late May, a number of directors including the Chair stepped up to buy shares.

Since then, we’ve seen more insider buying activity with the Chair making some large purchases (e.g. 350,000 shares @ £2.38 on 22 July). This is bullish, in my view.

Overall, I think the set-up here looks quite attractive. I’m tempted to go to a GREEN rating but I think I’ll leave it on AMBER/GREEN for now just because net debt/adjusted EBITDA is a little on the high side at 1.8x.