Daily Stock Market Report (Wed 21 May 2025) - TMO, ZIG, MAB1, MKS, JD., AVON, REVB, MEX

Wed 6:02am by Graham Neary

33 comments 4827 reads

Good morning and welcome to Wednesday's report! It's another busy day for updates.

The Agenda is complete.

Companies Reporting

Name (Mkt Cap)	RNS	Summary	Our view (Author)
SSE (LON:SSE) (£19.9bn)	Full Year Results	Adj PBT -3% to £2.1bn, EPS flat at 160.9p. “Record” capex of £2.9bn. Outlook: FY26 EPS of 175-200p.
Severn Trent (LON:SVT) (£8.1bn)	Full Year Results	EBIT +15% to £590m. Adj EPS +41% to 112p. “Record” £1.7bn capex (+40% YoY). Outlook: +ve.
Marks and Spencer (LON:MKS) (£7.6bn)	Full Year Results	Revs +6%, adj PBT +22% to £876m. Cyber impact c.£300m on FY26 op profit, before mitigation. Shore Capital estimates 32% pro forma hit to FY26 earnings due to cyber attack.	AMBER (Roland) The retailer’s FY25 results were excellent, but performance this year is likely to be significantly more difficult due to the ongoing impact of April’s cyber attack. There’s still no clear schedule for a return to normal operations and broker estimates suggest a big hit to profits. I think there’s the potential for a sluggish return to normal customer behaviour and perhaps some extra costs. I’m staying neutral for now, but would hope to turn positive again later this year.
Intermediate Capital (LON:ICG) (£6.0bn)	Final Results	AUM +14% to $112bn, PBT -11% to £532m due to lower investment returns. NAVps +9% to 859p.
JD Sports Fashion (LON:JD.) (£4.8bn)	Full Year Results	Rev +10% to £11,457m, adj PBT -4% to £923m. YTD in line with exps but tariff uncertainty remains.	AMBER/GREEN (Megan) Trading in the new financial year hasn’t started brilliantly, which maybe explains the poor response to these numbers. The quality metrics remain though, which makes a forecast PE ratio of 7x look pretty tempting.
RS (LON:RS1) (£2.9bn)	Full Year Results	FY25 in line. Rev -1%, PBT -15% to £206m. Markets challenging, maintaining medium-term targets.
HICL Infrastructure (LON:HICL) (£2.3bn)	Full Year Results	NAVps -3.2% to 153.1p, divi unch 8.25p. Underlying return of 7.7%., targeting £200m of disposals.
Ithaca Energy (LON:ITH) (£2.1bn)	Q1 Results	PBT +169% to $367.2m reflecting ENI UK merger. Hedging through 2027. FY25 guidance reiterated.
Currys (LON:CURY) (£1.41bn)	FY Trading Update	UK/Ire EBIT to be in line. FY adj PBT to be c.£162m (+37% YoY). Net cash >£180m. Resuming divis.
Great Portland Estates (LON:GPE) (£1.4bn)	Full Year Results	NAVps +4.4% to 494p, EPRA EPS in…

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rmillaree

Wed 7:36am

ZIGUP (LON:ZIG)

I wasnt really expecting much reaction today - this share tends to bumble along most of the time here. For a company with very obvious hard comparatives to follow (they made a boat load when van prices remained at elevated levels due to supply issues). They are ticking along very nicely - to me this company is all about the larger commercial contracts nowadays - eg if the likes of Tesco can outsource a van fleet - that will save them hassle and ziggy can make a reasonable margin for their troubles. Pretty simples - the other sides of the business are doing fine and are pretty complimentary. I highly rate management here who doa decent job and are very honest.

I suspect the investment in fleet and the increase is net debt may worry some - but they tend to keep borrowing at close to 50% of fleet value - they are buying more new vehicles and that costs cash. There is potential here once they have "newer fleet" that investment may reduce and the cashflow will flow through by the bucketload - they just need to stay away from any banana skins - perhaps dividend is tad generous but they can get financing off on decent terms so probably all ok - not a great fan of debt myself.

imho its good job done they they are churning out £100 pa of net profit compared to where they were pre covid.

commentators here dont seem to get or rate the business model (whats not to like about customers who like what you do at reasonable prices) i am happy to keep holding here whilst management are doing decent job.

They update their ir page during the year so you can keepa tally of theur billy basic current expectations - its very minimilistic though. would be nice if they could have some more forward looking public numbers (nice if they had equity developments on board - i like the transparent numbers they provide) - i will await the behind the scenses nods and winks and how that translates into any changes ref the new year just strating - i supect its tickover stuff and the positives today will soon be forgotten. Divi is fine to keep me in pasties and beer and thats really my main priority in life so all good.

https://zigup.com/investors/sh...

Roland Head

Wed 7:38am

Morning Mulberry,

We covered the offers for Renold (LON:RNO) in yesterday's report:

https://www.stockopedia.com/co...

Roland

Samsgrandad

Wed 7:40am

When anything happens, copper probably helped it to happen and Central Asia Metals (LON:CAML) pay a great dividend.

ScotchGambit

Wed 8:23am

(I hold too) They do pay a good dividend at the moment Samsgrandad, but with new debt to fund the purchase, and a new mine to develop I'm expecting that to take a huge hit as of today. I've not come across a situation like this before but I've set my expectations to have the dividend cancelled for the foreseeable. Is that reasonable to assume?

Either way this looks like a good deal to me and hopefully long term this should be a good holding.

MiserableJacktPotato

Wed 8:27am

Warpaint London (LON:W7L) going after Revolution Beauty (LON:REVB) ? Or is it Booho, sorry £DEB

Will be interesting to see who the bidder is.

grout123

Wed 8:29am

i love their chicken tikka masala

Paul2148

Wed 9:03am

I agree, The company is doing what it said it would.

For me, one of the compelling moving parts has been the cultural change to embrace continuous improvement (CI) and how its improved their operating margins. This was really well explained in their capital markets day about a year ago and more to come in this regards.

Two other points taken from today’s report.
1. Russias increased (sadly) use of drones to drop chemical weapons, points to NATO countries potentially improving their troops CBRN kit.

2. Maybe a hint of a new helmet deal in the background, from outside the US, which would reduce concentration risk.

Nathan Smith

Wed 9:05am

Anyone got any thoughts on the potential Kenmare Resources (LON:KMR) takeover. Deadline has been extended twice now and stock seems to be drifting. Wish they would have just accepted the 530p offer

Mulberry

Wed 9:17am

Thank you, I missed the added RNO ticker on yesterday's earlier market report. Some skepticism in this morning's price action that the bids will firm up. I have been waiting years for RNO to be taken over and the caution is understandable. Two big orange flags, which the PE guys must be aware of: still ~£50m pension liability, and the large exec share compensation scheme which RNO don't like talking about. Given RNO generates 40% of revenue from US-based manufacturing, it was a very obvious play in the Trump era. Which is why it was an outlandish 25% of my portfolio.

Albertos

Wed 9:18am

Central Asia Metals (LON:CAML)

(Don't hold currently)

Going from memory they continued to pay dividends when they bought Sasa - but that was a producing mine so this time might be different. Don't think they'd cut to zero as a lot hold for income.

Any worries about the funding of the Pre-production capex of $298m? That's quite a number given CAML's MV of less than $400m. They say it's "Manageable" but this introduces some caution in my mind as one of the reasons for investing in the past was its relatively low risk for a junior miner.

UncleG

Wed 9:27am

I got lucky on this and took a starter position in Ithaca Energy (LON:ITH) at the back end of last year in time to receive the special divi and the first one this year. Holding the same bias and thought the results today look good so I did my bit for the environment :) and recycled the Harbour Energy (LON:HBR) divi from today and the previous ones collected back into Ithaca. The divi's for this year look to be on track so hopefully that'll give Jeffries enough time to change their mind again. Nearly sure they downgraded HBR and or SQZ as well recently so maybe they're just negative on the sector in general ...

Roger Baron

Wed 9:35am

I had missed that yesterday. I had previously seen that Roland had stated “it looks perennially cheap" and Paul Scott here had previously highlighted it a few years ago with a 30p target. Big thank you for that and the subsequent positive comments as I bought at 21.7p and have held them ever since. Always nice when 2 bids are on the table.

SundayTrader

Why would they have? Kenmare Resources (LON:KMR) has a very long life, it is paying good dividends, and its product prices are currently firming up a little. I would have thought a good many shareholders, like myself, would be comfortable holding.

Wed 9:37am

Thanks Albertos, Apparently they held a call for investors and confirmed Div will be cut to 30%-50% FCF (So 30% !). I wasn't on the call but will try to find a recording and confirm.

What you mention above makes sense. They perhaps don't want to cut the Div completely and crash the share price as they will likely need to raise additional capital from shareholders for the new mine!?

Short term risk has increased with a now "unknown" mine but to me there seems to have been enough work done by the previous owners to confirm the upside of this deal.

Lord Gnome

Wed 10:23am

Apparently (second hand news) in the same report that Jeffries downgraded Ithaca Energy (LON:ITH), they reinitiated coverage of Serica Energy (LON:SQZ) with a buy recommendation and a target price of (just) 165.

Since when, the price of Serica has also fallen, but not quite so much. So that's ok then. I hold both.

FWIW I want to do a bit of recycling of my own and add more to both holdings. Just need to decide what to sell first.

Burnt Onions

Wed 12:07pm

Tortilla Mexican Grill (LON:MEX) Hi ctoman, I did a lot of work on this a couple of years back and was previously a decent sized shareholder eventually selling out for a small loss. Yes the CEO is young and keen but very promotional and unfortunately not enough focus on the bottom line and operating margins, a bloated head office and an overpaid board make for a poor return for shareholders. Not sure if they have the cash to oversee the French conversions through to profitability, we shall see......

Wed 12:47pm

I'm looking to add to Serica Energy (LON:SQZ) as well if I can before it goes ex divi next month and hopefully before any positive news on the Triton maintenance comes out. Last year I sold out of i3e before it was taken over and split the money three ways into SQZ, ITH and HBR. So far HBR is the only one of the three that's underwater and as the saying goes 2 out 3 ain't bad so I'm happy to keep an eye on them , collect the divi's and see how things play out for now.

Happy days and all the best with the recycling.

topvest

Wed 12:57pm

Intermediate Capital (LON:ICG) - great results from this niche investment manager. 60% operating margins on its fully-scaled fund manuagement business. Illiquid investments appears to be the place to be as an asset manager at the moment.

ctoman

Wed 2:56pm

Tortilla Mexican Grill (LON:MEX) thanks Burnt Onions - interesting concern re cash. Looking at the major shareholders there has been some positive accumulation. There's an Investor meet company on 23rd May. I am a holder...probably for a little too long! The original plan was that one of the US tortilla chains would buy Tortilla Mexican Grill (LON:MEX) out.

Rusty2

Wed 3:11pm

Does Tortilla Mexican Grill (LON:MEX) and burnt onions go well together?

Daily Stock Market Report (Wed 21 May 2025) - TMO, ZIG, MAB1, MKS, JD., AVON, REVB, MEX

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Graham Neary

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