Edison Investment Research

Etsy - Red Flags

Etsy serves as a warning to Uber

Market Commentary - Housing, Infrastructure, Construction and Services 28th June 2017

Kier’s trading year end update ahead of a CMD tomorrow is the main news this morning. The one-offs will attract attention but should not be allowed to overshadow what appear to be positive results to come in most areas of the operations. The moves yesterday were almost all downwards. The reality that interest rates are going up at some point, the UK economy is slowing and that political uncertainty is creating delays is starting to be realised.

Market Commentary - Housing, Infrastructure, Construction and Services 23rd June 2017

Workspace has the floor to itself this morning with its £159m acquisition of Salisbury House in Finsbury Circus. Moves yesterday were in a tight range with Grafton leading the way rising just 1% to 733.0p and Balfour Beatty suffering a little, along with other contractors, down 1.6% to 277.8p.

Altamir – Part-sale of Altran shares

Altamir has sold 50% of its largest holding, Altran, realising an estimated c 13% uplift to its portfolio valuation

Apax Partners and Altamir (LTA) have sold 14.8m shares in Altran Technologies, representing 50% of their combined 16.8% holding prior to the sale. In addition to the 8.4% of Altran’s share capital sold by Apax Partners and Altamir, the founding shareholders of Altran sold part of their shareholding, with a total 19.8m shares being sold, equating to 11.2% of Altran’s share capital. The shares were sold in a private placement to institutional investors at €15.0 per share, a 6.7% discount to the closing price of Altran’s shares on 21 June 2017, generating proceeds of €297m.

Market Commentary - Housing, Infrastructure, Construction and Services 22nd June 2017

James Latham, a £200m revenue a year timber merchant, reported its finals to end March 2017 this morning. Capita topped the leader board again yesterday with a 3.8% rise to 696p as big brokers start to change view. Are there other examples of stocks that are substantially out of favour but have strong market positions you may ask?

Snap Inc. - Snap in the box

Facebook keeps Snap Inc. in its box.

Equity risks are rising: economic surprises turning lower

Economic surprise turns lower and positive earnings momentum easing in Europe

We are viewing with increasing concern the building evidence of disinflation in industrial commodity and energy markets. Economic surprise indices have turned sharply lower on a global basis, a move which cannot be fully explained by seasonal factors. In this context we were surprised by the relatively hawkish recent policy statements by the US Federal Reserve and Bank of England. For the US Fed, it was very much a case of one and not done at the recent FOMC meeting, where US rates were increased again. For now, earnings growth forecasts near 10% for each of the US, UK and continental Europe remain intact but we also detect ebbing momentum in this data compared to 6m ago.

Market Commentary - Housing, Infrastructure, Construction and Services 21st June 2017

Berkeley’s finals for the year to end April are as candid as usual. The key message is that Berkeley is doing a good job of building new homes and making valuable contributions to society (e.g. apprenticeships, social housing units, taxes paid, charities to which the company has donated) despite the headwinds being created by the politicians (e.g. stamp duty, mortgage relief on BTL loans, Brexit, planning system). The moves yesterday included only small changes.

Deutsche Beteiligungs – First MBO investment in Switzerland

Third investment by DBAG Fund VII within six months of the start of its investment period

Deutsche Beteiligungs (DBAG) has announced that it will invest up to €14m for a 22% interest in duagon, a Switzerland-based provider of network components for data communication in railway vehicles. The deal represents DBAG’s first management buyout (MBO) in Switzerland and the third MBO investment by DBAG Fund VII within six months of the start of its investment period. The €1bn DBAG Fund VII will be 20% invested following the transaction, which is expected to complete in July 2017.

South east basin most popular in latest Mexico round

Following on from our recent Offshore Mexico ‘Exploration Watch’ (Click here for report), bidding in Round 2.1 was concentrated on the south east basins and saw the first entry to the basin of supermajor Shell as well as UK independent Cairn Energy. Ten of the fifteen shallow water blocks on offer were awarded, with nine of these located in the Sureste Basin. Only one block, Block 2, was awarded (to Dea Deutsche and Pemex) in the five blocks on offer in the Tampico-Misantla and Veracruz basins.