Royal Mail on course for FTSE100 return10 Feb 2021 19:17
"All of a sudden everything in the garden looks rosy for Royal Mail Group PLC (LON:RMG).
Parcels demand has boomed during lockdown while a deal has just been agreed with its main union the CWU over pay, technology and working hours.
Thursday's third-quarter trading update also gives new chief executive Simon Thompson a first opportunity to explain his plans for the future.
Thompson hails from Ocado, the supercharged food delivery operation that is now rolling out automated fulfilment centres.
Automation has long been touted as a necessity for the postal service so any plans here will be keenly noted both by employees and investors.
Brokers, meanwhile, have been steadily upping their forecasts for the year to March 2021.
Citigroup has just raised its forecast for underlying profits to £289mln helped by the parcels tailwind, which it reckons has been strong enough for RMG to increase prices giving a boost to margins.
The US broker also expects a statement about the resumption of dividends.
Shares have risen to 421p currently from a twelve-month low of 124p in April 2020, valuing the group at £4.2bn, which might be enough to re-enter the FTSE 100."