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07 February 2020

Redmayne Bentley’s Top Trades

Below, we take a look at the most frequently traded shares through Redmayne Bentley over the last couple of weeks and consider why they have been so popular.
 
ROYAL DUTCH SHELL (RDSB)
Index: FTSE 100
Sector: Integrated Oil & Gas
Market Capitalisation: £158,722.35m
 
Royal Dutch Shell reported that the company’s fourth-quarter earnings in 2019 dropped 48.21% to US$2.9bn, compared to the previous quarter, in the most recent trading update. The oil and gas firm blamed lower oil prices and difficult economic conditions for lower margins and profits. Additionally, the company announced it would reduce share buybacks in the upcoming quarter to US$1bn from US$2.8bn in the fourth quarter, as more funds need to be held as a measure against volatility. The investors have reacted negatively to the news and Royal Dutch Shell’s shares shed 8.21% in the last week. Currently, shares are down 15.56% over the year and are trading at 9.35 P/E.
 
 
ASTON MARTIN LAGONDA (AML)
Index: FTSE 250
Sector: Automobiles
Market Capitalisation: £1,031.49m
 
Luxury sports car manufacturer Aston Martin has experienced a rough ride, falling 71.32% since its IPO in October 2018, as the company reported profit warnings throughout the year. After holding a board meeting to discuss potential emergency funding options, Aston accepted Formula 1 billionaire’s Lawrence Stroll’s offer to invest £182m for a 16.7% stake in the firm. Mr Stroll believes that Aston Martin is “a phenomenal brand that has tremendous potential”, as he will change his F1 team’s name from Racing Point to Aston Martin F1. The shares of the company surged 23.9% the day after the announcement, as investors regained hope for the future. The shares are trading at 16.04 P/E, having dropped 59.95% in the last year.
 
 
AMAZON.COM (AMZN)
Index: NASDAQ-GS
Sector: Consumer Services
Market Capitalisation: US$1.01tn (£780.95bn)
 
Tech giant Amazon.com reported profits that sharply exceeded analysts’ forecasts in the end of January 2020. The company said that net income for the latest quarter was US$3.3bn, compared to the US$1.97bn consensus. Lower one-day delivery service infrastructure costs contributed towards higher net income, as the costs were lower than the US$1.5bn expected. Additionally, the new faster delivery service is already attracting new customers, with Amazon Prime subscriptions rising to more than 150m. The markets have reacted to the news positively, as the share price advanced 7.38% the day after the report. Currently, Amazon remains expensive at 87.17 P/E, after growing 22.71% in the last year.
 
 
Top Trades is published every fortnight in Equity Insight, a newsletter written by our stockbrokers and investment managers. It provides market commentary, a focus on individual sectors, technical analysis, potential trading opportunities and share reviews.
 
Please note that investments and income arising from them can fall as well as rise in value and you may lose some or all of the amount you have invested. Past performance and forecasts are not a reliable indicator of future results or performance. Please note that this communication is for information only and does not constitute a recommendation to buy or sell the shares of the companies mentioned.
 
Redmayne Bentley’s Top Trades
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