UK WINNERS & LOSERS SUMMARY: Fevertree Drops 24% After Profit Warning

Mon, 20th Jan 2020 10:45

(Alliance News) - The following stocks are the leading risers and fallers within the main London indices on Monday.

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FTSE 100 - WINNERS

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Auto Trader, up 2.5%. Goldman Sachs raised the car marketplace to Buy from Neutral.

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BAE Systems, up 2.3%. The defence company said it has made two acquisitions in the US, purchasing the military global positioning system from a United Technologies Corp unit and Raytheon Co's Airborne Tactical Radios business. The Farnborough-based aerospace firm is acquiring a military GPS business from Collins Aerospace - a unit of US aircraft manufacturer United Technologies - for USD1.93 billion in cash. BAE is also buying US defence contractor Raytheon's Airborne Tactical Radios business for USD275 million in cash. These deals are subject to the closure of the merger between Raytheon and United Technologies.

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FTSE 100 - LOSERS

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WPP, down 1.0%. Goldman Sachs downgraded the advertising agency to Neutral from Buy.

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FTSE 250 - WINNERS

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Vesuvius, up 1.0%, Bodycote, up 0.9%. Barclays started coverage on the molten metal flow engineer and the thermal processing services provider at Equal Weight.

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FTSE 250 - LOSERS

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Capita, down 3.6%. UBS downgraded the outsourcer to Sell from Neutral.

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OTHER MAIN MARKET AND AIM - WINNERS

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Rockfire Resources, up 42%. The metal explorer said it recommenced drilling to expand gold mineralisation, encountered in hole BPL025 at its 100% owned Plateau gold deposit in Queensland, Australia. Back in November Rockfire had said it intersected broad and consistent gold assays, indicative of a large-scale gold deposit, 177 meters at 0.5 grams per tonne gold. Rockfire said reverse circulation drilling is now in progress, and it is expected to take approximately 15 days to complete. Geophysical anomaly will be tested by drilling two holes of 50 meters and 150 meters respectively, east of hole BPL025, with gold analyses to follow the completion of drilling. The drilling program will aim to extend the near-surface gold resources at Plateau in north Queensland, the company noted.

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ASOS, down 4.5%. Morgan Stanley downgraded the online fashion retailer to Underweight from Equal Weight.

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OTHER MAIN MARKET AND AIM - LOSERS

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Fevertree Drinks, down 24%. The premium tonic water maker said revenue is expected to come in below board expectations, due to "subdued" Christmas trading in the UK. For 2019, Fevertree expects total revenue of GBP260.5 million, which would represent a 9.7% increase on the GBP237.4 million generated in 2018. Fevertree, in spite of the "soft" trading, said it continued to invest in the business. As a result, its margins will end 2019 behind expectations. The company expects earnings to fall by about 5% from 2018. Fevertree reported adjusted earnings before interest, tax, depreciation and amortisation of GBP78.6 million in 2018. Looking forward, Fevertree said it will continue to invest in its business, and is guiding for gross and Ebitda margins of about 49% and 28% in 2020. "The price Fevertree is now paying as a result of its incredible success over the years is increased public scrutiny. The bigger the company gets, the more the critics line up to point out any flaws and weaknesses. In reality this remains a highly commendable British success story and it is only natural in the course of business to experience trading hiccups," said AJ Bell's Russ Mould.

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By Arvind Bhunjun; arvindbhunjun@alliancenews.com