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Friday tips round-up: Centrica, Rexam

Fri, 20th Feb 2015 17:43

In an unexpected move, Centrica's new chief, Iain Coon, decided to cut the dividend pay-out for the first time in the company's history. It was reduced by 30% to its lowest since 2009. At approximately 4.2%, and down from 6.1%, the company's dividend yield is now almost the worst in the sector. That explains the sharp fall in the share price on the back of the announcement. The firm reassured investors the dividend will rise again in the future, but after reading last year's results its base of retail shareholders will be none too confident.The energy outfit is being battered on several fronts, including lower global oil and gas prices, UK power prices and household supply margins. To that one must add the mild winter weather in Britain; hence management's decision to cut their profit guidance for this year. Centrica has put in motion a strategic review which is due to report in July. However, with the Competition and Markets Authority not expected to report its final conclusions until the end of the year, Conn has scant room for manoeuvre to deliver changes. Nonetheless, new company bosses have a tendency to exaggerate bad news and oil prices are rising. So hold, says The Times's Tempus.Lost in the excitement surrounding news that can-maker Rexam had recommended the acquisition offer from US rival Ball Corporation were the firm's solid full-year results. Despite the "unprecedented" increase in aluminium costs and fierce competition, the company registered a 4% rise in drinks-can volumes and achieved a return on capital employed of 14.9%, generating £225m in free cash-flow.Its American rival has offered an aggregate amount of 628p per share and the stock had risen to 569.5p, so there appears to be scope for a quick profit. But there is a high degree of regulatory risk remaining. Ball and Rexam may also be asked to sell assets generating turnover of £1.5bn to satisfy the competition authorities. Therefore, should the takeover fizzle out the stock could get hammered. Avoid, says Tempus.

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19 Feb 2015 21:37

Moody's may downgrade Ball Corp over Rexam deal

By Mariana Santibanez NEW YORK, Feb 19 (IFR) - Moody's said on Thursday it may downgrade US can maker Ball Corp amid the company's planned Â£4.43bn (US$6.85bn) acquisition of British rival Rexam Plc. Moody's placed Ball's junk Ba1 rating on review for downgrade, citing the company's "

19 Feb 2015 16:52

MARKET COMMENT: London Ends Mixed As Germany Dismisses Greek Terms

19 Feb 2015 16:45

UPDATE 3-Ball Corp to buy British drinks can maker Rexam for $6.9 bln

* Cash-and-stock deal valued at 628 pence per share * Anti-trust concerns hold back share price * Ball to remain U.S. domiciled for tax (Adds Ball and analyst comments, context, updates shares) By Esha Vaish and Roshni Menon Feb 19 (Reuters) - U.S. drinks can maker Ball

19 Feb 2015 16:33

London close: Greek developments, central bank uncertainty keep UK stocks flat

It was another subdued finish for London's stocks on Thursday as the market continued to fluctuate at a 15-year high on the back of mixed newsflow about Greece and uncertainty regarding global monetary policy. The FTSE 100 finished the session down just 0.1% at 6,888.90. The index has stayed broadly

19 Feb 2015 16:00

FTSE 250 movers: Petra Diamonds boosted by higher production guidance, Man Group stonger on upgrade

Petra Diamonds topped the risers after raising its production guidance from 3.2m to 3.3m carats for the 12 months to 30 June. "Our expansion programmes are on track at all operations, and production is expected to grow to about 3.3m carats in 2015 and to about 5m carats by financial year 2019," said

19 Feb 2015 14:08

BUZZ-U.S. STOCKS ON THE MOVE-Wal-Mart, Priceline, Ocera Therapeutics, Netlist

(For faster updates on individual market-movers, Eikon users please use search string "STXBZ US"; for the Day Ahead newsletter, http://link.reuters.com/mex49s; for the Morning News Call newsletter, http://link.reuters.com/nex49s) U.S. stock index futures pointed to a flat open on Wall Stree

19 Feb 2015 12:42

UK MIDDAY BRIEFING: Greek Deal Optimism Gives Way To Uncertainty

19 Feb 2015 11:39

London midday: Stocks recover as Greek hopes outweigh Fed uncertainty

UK stocks had erased earlier losses by Thursday lunchtime as hopes about Greece outweighed uncertainty arising from the minutes of the latest Federal Reserve policy meeting. The FTSE 100 was up just 0.02% at 6,899.24 by midday, having bounced off an intraday low of 6,858.67 reached early on. The in

19 Feb 2015 11:26

UK WINNERS & LOSERS: Centrica Shares Tumble On Dividend Cut, Warning

19 Feb 2015 11:18

TOP NEWS: Eurogroup Set To Convene Friday As Greece Seeks Extension

19 Feb 2015 09:10

UPDATE: Rexam Agrees GBP4.3 Billion Takeover Offer From US's Ball Corp

19 Feb 2015 08:43

London open: Centrica and BAE lead markets lower after FOMC minutes

Uncertainty surrounding the future of monetary policy in the States was weighing on UK stocks on Thursday morning, after the Federal Reserve showed it was wary of raising rates too soon. The FTSE 100 was down 0.3% at 6,879 early on, with energy provider Centrica and defence contractor BAE Systems le

19 Feb 2015 08:42

UK's Rexam Confirms GBP4.3 Billion Takeover Offer From US's Ball Corp

19 Feb 2015 08:34

UK MORNING BRIEFING: Centrica Shares Fall 7.7% On Loss, Dividend Cut

19 Feb 2015 08:25

BUZZ-Rexam: jumps on $6.85 bln Ball Corp offer

** British drinks can maker Rexam jumps 6.4 pct, after saying U.S. rival Ball Corp offered to buy the company in a cash-and-stock deal valued at about 4.43 bln pounds ($6.85 bln) ** Stock up 23 pct YTD, easily one of the most actively traded stock on FTSE 250 ** Rexam said its shareho

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Friday tips round-up: Centrica, Rexam

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