The M&C20 was down 0.3% this week, underperforming a 0.7% rise in the All-Share Index, as profit taking of SSP Group’s shares held the M&C’s index back, while the minutes suggesting a rate rise may be delayed from the last BoE interest rate meeting supported the wider market.
Marston’s shares rose 4% this week. The group’s shares have been strong recently and the stock looks to have moved into a new trading range. The good recent weather is also likely to support pub share prices as sunshine tends to be better for pubs than it is for restaurants.
Punch and Enterprise both gave back some of their recent gains, with Punch down 3.2% and Enterprise down 0.4%. Both companies have had a strong share performance in recent weeks as the market digested news that Enterprise believes it can set up a managed division of c800 pubs and a property division of another 1000 pubs, which will somewhat mitigate the impact of the MRO.
Greene King and Spirit shares were down 0.1% apiece. The merger between the two companies is due to complete this summer if the Competition and Markets Authority agrees to the two companies’ proposals for mitigating the competition issues the CMA identified in 16 local areas.
Several small caps saw fairly large movements in their shares this week. Richoux shares rose 13.6% this week following the release of the group’s full year numbers last Friday which saw profits down but revenue up from £11.5m to £12.7m. The Heavitree Brewery also saw its shares rise 10.3% this week, though this is on the back of low volumes and a wide spread.
Fulham Shore saw its shares fall another 10.4% having fallen some 9.6% last week. The group’s shares are very tightly held and the price is therefore more volatile than more liquid stocks and with most of the register likely to have got into the stock at 11p or below, there will be some who are inclined to sell.
Patisserie Valerie had its half year numbers on Wednesday in which the group announced pre-tax profit was up 45% and revenues up 22.2% sending the group’s shares up 11.9% this week.
SSP Group saw its shares fall 3.5% following the group’s interims this week. The group’s numbers looked solid with like for like revenue growth of 3% and operating profit up 35.2%, but at a price of more than 22x earnings, some investors will be inclined to take profits.
Next week is quiet on the reporting front with only Cineworld producing a trading update for the 19 weeks to 14 May.
Commentary provided by Will Brumby of Langton Caital
