Daily Stock Market Report (Wed 18 June 2025) - RKW, AO., SUS, MPE, PZC, OMG

6:02am by Graham Neary

41 comments 4557 reads

Good morning! Let's see what the RNS has in store for us today.

Spreadsheet accompanying this report: link.

The Agenda is complete.

That's as far as we've got today, thanks for the input everyone.

Fed Interest Rate Decision

As noted in The Week Ahead, we have a Fed interest rate decision to look forward to this evening.

No change is expected to the Fed Funds Rate (4.5%), but we can expect some commentary to shed light on what to expect for the rest of the year.

The Fed has plenty of reasons for caution - tariffs and the conflict between Israel and Iran being the obvious ones - but at the same time, has come under political pressure from the White House to cut rates faster. The current expectation is that the Fed will cut rates twice this year.

I find it interesting that the dollar has been so weak - currently at multi-year lows - despite the Fed's rates being higher than many other central banks (the ECB is at just 2.15%). Perhaps this is mostly due to the US fiscal situation, with the deficit running at 6% of GDP and with total debt standing at c. $36 trillion (vs. GDP of $30 trillion). Perhaps Trump will need to make a few trillion-dollar coins?

Companies Reporting

Name (Mkt Cap)	RNS	Summary	Our view (Author)
Derwent London (LON:DLN) (£2.2bn)	Adobe lease extension and expansion	Adobe has extended its London lease to 2038 and added 25% new space, ann. rent £4.5m.
Ocado (LON:OCDO) (£2.0bn)	New CFC in Catalonia	Ocado will build a CFC for existing partner Bon Preu, which currently uses OCDO’s in-store fulfilment.
Personal Assets Trust (LON:PNL) (£1.62bn)	Final Results	NAV +5.8% to 515.22pps. NAV total return 7.5% vs FTSE All Share +7.5%.
AO World (LON:AO.) (£585m)	Full Year Results	Rev +9%, adj PBT +27% to £44m, at top end of guided range. FY26 outlook unch: PBT of £40-50m.	AMBER (Roland) Today’s results are largely as expected, although they do feature a chunky impairment to AO’s mobile business. The outlook for FY26 is also largely unchanged, suggesting modest profit growth at best. With the stock trading on a P/E of 18, I can’t get higher than neutral. However, I do think AO is continuing to execute relatively well in a tough market.
M P…

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JimMcLad

12:21pm

Jonno Brickability (LON:BRCK) I noticed the Octopus buys and assumed they'd acquired the director's sales. Vote of confidence afaic ............ so probably wrong. I'm still holding.

Robert W

12:37pm

I assume this is Serge wanting to get his money out. This was looking like a great buy and hold share, so really a shame for me. I just hope if it happens it is clean, cash-based break so Serge is incentivised to get the best price.

The Ox 2906

12:42pm

I agree very underwhelming I think and a clean break was what Lord Lee was hoping for I believe on the IC podcasts that he does, I think coupled with other divestments which as yet are non existent.

12:50pm

It's a really simple, cash generative, repeatable business model that could be levered up to expand internationally so PE might be interested.

The Phoenix

I did speak to a UK mid cap fund manager about ME International (LON:MEGP) all be it about 18 months, I brought up Serge's advancing years and he seemed to think the family would take it forward but seems that might not be the case any longer.

BnB

12:51pm

Hi Jonno. My take on the Brickability disposals, aided by a glance at the chart, is that the directors are not necessarily negative on the long-term prospects, but they do not perceive the shares exceeding their recent highs in the near future. In itself, that shares are up with events should not be a reason for concern. But my conclusion is that insiders judge that the period of time which would be required to see improvements in operational performance is great enough to allow for the possibility of new headwinds making the task harder. A simpler interpretation would be to conclude that insiders did not like what they saw in the Ibstock results and subsequent market reaction!

Although the name is held in the BnB fund, it is for cyclical exposure since much lower levels and is not a high conviction holding. Every time the SP puts on a head of steam, the fund reduces exposure back to the size of the original capital, buying back on dips. This is the third such time that the fund has acted accordingly. And I believe this is a prudent approach for what is a business of only moderate quality - owing to the markets to which it is exposed, not a comment on the quality of management.

Christopher McGlone

2:27pm

I ‘went Green’ last week and topped up, not necessarily because of the upcoming AGM but because i just can’t see the Supreme Court ruling having a significant longer term negative impact on the S&U business; Share Price maybe. But hey, I’ve been plenty wrong plenty before! Therefore, my buy may be premature but it’s now in an ISA and staying there. Capital gain would be welcome if a bit of growth would return but content to compound dividends while i wait. C

Burnt Onions

3:05pm

ME International (LON:MEGP) I don't think you can rule out the CEO taking it private himself, he already owns nearly 40%, the business has no debt, so why not a LBO? take it private, pay back the debt with all that cash flow and then you've got a perfect family business to leave to your kids? That's what I would do.....

LindenP

3:08pm

Hi Graham Neary, I'm wondering if you will be writing about Speedy Hire (LON:SDY) ? Thanks, Linden.

3:16pm

Hi Roland, will you or Graham be writing about Speedy Hire (LON:SDY) today? Many thanks, Linden

The Boon Fund

3:43pm

What's the other battery storage fund in the UK? Was planning to have a look at both of them again, after not looking for the last 2 years.

3:45pm

PZ Cussons (LON:PZC) haven't yet been able to find a buyer for St Tropez.... despite the US focus, one might expect plenty of healthcare/beauty brand buyers in the USA have money to spend on acquisitions, if it was a good brand...

I expect the sale price to be underwhelming when it goes through....

3:50pm

2025, 2026 are weird years for Spectra Systems (LON:SPSY) as there will be bumper revenues, profit from a one-off project to supply sensors to a central bank customer.

Imminently though will be a Maintenance Contract announcement for said sensors once manufactured, delivered, and deployed. This hasn't been baked into analyst forecasts, because they are only calculating Rev and EPS based on firm contracts, not expected.

But one can imagine that its very unlikely the central bank, which Spectra has been working with for years (decades maybe?) and spent so much money paying Spectra to design and build the sensors, will then give the maintenance contract to a third party.

I get that Spectra is a complicated story, and also very lumpy when it comes to contracts. I wrote a long comment yesterday (or the day before?) about Fusion and the latest RCS announcement. Search my past comments in my user profile for that.

(I hold in the Boon Fund)

4:05pm

Yeah, a little underwhelming in terms of strategic update from James Cropper (LON:CRPR) .

I'm going to try to see if I can get the full investor presentation deck later on, to "see the details".

For me, the story on their Advanced Materials division is focused on Green Hydrogen. I think there is a surge of investment coming here - with UK government subsidies agreed (search for HAR1 and HAR2) and there must also be govt subsidies in Germany, other EU markets.

There is disappointing news in the USA, with the Trump tax bill gutting subsidies for Green Hydrogen. But still a chance for the senate to amend and save it maybe...

Then there is the competition for Electrolysers (what AM division is building) from China. Of course, China is throwing huge subsidies to their local industry to make them dominate manufacturing globally. Like they did with Solar and Batteries. Can JC survive, manufacturing in the UK? Big question mark. This recent article says eletrolysers from China are half the price...!

However, I think governments around the world have learnt their lessons with Infrastructure equipment, that we shouldn't rely on Chinese tech. So potentially, we might see a political moat around hydrogen and electrolysers. Certainly the USA won't be buying any from China... with the tariffs... but unsure about UK and EU at the moment? I need to dig into it more.

(I hold CRPR in the Boon Fund)

jonno

4:06pm

I am unable to access the charts on the website. Has anybody else had the same difficulty?

I messaged Stockopedia some hours ago, but still await a reply

Pimlico on Thames

4:24pm

Assume no tariff on their self (artificial) tan from the orange one

Rusty2

4:26pm

No, l have not had any problems with charts.

4:30pm

Gresham House Energy Storage Fund (LON:GRID) ?

4% yld, 33% discount to NAV of 110.5p

apozniak

4:36pm

Gresham House Energy Storage Fund (LON:GRID)

Mark Carter

4:38pm

MPE It's worth noting that declared a final dividend in Apr 2025 of 37.5p. Its forthcoming interim divvie is likely to be at least 15p. 10 years ago its interim div was 2.25p and finals was 6.5p.

It's ROCE has averaged 14% over the last 6 years, and had a net cash position. That's pretty good.

It trades on a P/FCF of 6.6. EV/EBITDA is 5. That's usually regarded as cheap, although remember it is a commodity company.

I think it slips under most people's radar as it operates in a dull sector. There's nothing dull about its performance though.

I hold.

Daily Stock Market Report (Wed 18 June 2025) - RKW, AO., SUS, MPE, PZC, OMG

Fed Interest Rate Decision

Companies Reporting

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Graham Neary

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