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01 December 2017

Just Eat joins FTSE 100 after gaining bigger slice of the pie

Increasing investor appetites have helped promote takeaway app tech star Just Eat into the FTSE 100.
Boosted by the smartphone revolution and a string of recent deals, the firm, which enables diners to quickly access fast food outlets online, will join the top flight index in its December reshuffle.

However, Dorset-based Merlin Entertainments, which owns Alton Towers, Legoland Windsor and numerous other theme parks and tourist destinations worldwide, has been relegated to the FTSE 250.

Entering the FTSE 100:

Just Eat
Having been priced at 260p when it first listed in April 2014, shares in the world’s largest online marketplace rose to an all-time high of 827p last month when Just Eat’s latest acquisition, Hungryhouse, was approved by the Competition and Markets Authority in November. At close of trading on Thursday 30th November, shares were trading at 798.50p.

Smith (DS)
Packaging firm DS Smith wrapped up its promotion after strong sales and earnings growth. Like Just Eat, the firm has been boosted by online shopping, with cardboard packaging used to carry goods ordered over the internet. Due to its overseas presence, the firm also benefits from the impact of Brexit and weakness in Sterling. Shares in the company were 540.00p at close on 30th November.

Halma
In its most recent update, the health and safety sensor technology firm announced that its revenues had risen 15 per cent to £503.6m in the six months to the end of September. Chief executive Andrew Williams said Halma had “continued to make strong progress.” Shares in Halma were 1280.00p at close of trading on 30th November.
 
Exiting the FTSE 100:

Merlin Entertainments
Merlin Entertainments had been enjoying a boost to British tourism from the weakened Pound following the EU referendum result in June 2016. However, the share price fell sharply following its trading update of October 2017, in which it said like-for-like revenue had slipped to 0.3 per cent in the third quarter, with poor British summer weather and heightened fears around terrorism impacting visitor numbers to its attractions. At close of trading on 30th November 2017, shares were 351.90p.

ConvaTec
Shares in the medical products and technology organisation fell sharply in October this year after the business announced it had been severely affected by supply issues in its wound and ostomy care divisions, as well as a lower-than-expected sales contribution from new products, although they did go on to recover some ground. Shares were 194.00p at close on 30th November 2017, still below the 225p issue price when they listed on the London Stock Exchange in October 2016.

Babcock International
Mid-cap defence organisation Ultra Electronics caused jitters across the wider defence sector in November when it issued a warning around mounting pressure on UK defence spending. The 126-year-old organisation Babcock fell more than seven per cent after the news.  However, in its trading update on 21st November, chief executive Archie Bethel said the firm remained “confident that full year results will be in line with our expectations and that we will make further good progress beyond this year.” At close of trading on 30th November, shares were 697.00p.

Joining the FTSE 250 will be used car dealer BCA Marketplace, which posted revenues of more than £1bn in the six months to 1st October as a result of growth at WeBuyanyCar.com. They were joined by F&C Global Smaller Companies investment trust; Purecircle, which manufactures stevia sweeteners for the global beverage and food industry; RHI Magnesita, which began trading on the London Stock Exchange in October, and engineering fluid maker TI Fluid Systems.

British-based investment trusts Electra Private Equity and P2P Global Investments have lost their places in the FTSE 250, along with Nostrum Oil & Gas and payment systems provider PayPoint. In stark contrast to the fortunes of Just Eat, the British pub and restaurant chain Restaurant Group has left the FTSE 250, as dining at home has become an increasingly attractive alternative to eating out over recent years.
Changes to the index come into effect on Monday 18th December 2017.

Investment and income arising from them can fall in value and you may lose some or all of the amount you have invested. Past performance and forecasts are not reliable indicators of future results or performance.
Please note that this article is for information only and does not constitute a recommendation to buy or sell the shares of the companies mentioned.
 
 
Just Eat joins FTSE 100 after gaining bigger slice of the pie

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