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23 May 2019

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.

THOMAS COOK (TCG)
Index: FTSE All-Share
Sector: Travel & Leisure
Market Capitalisation: £191.52m
 
The holiday, hotel and airline group Thomas Cook spooked investors with its latest set of interim results last Thursday (16th May 2019). After tendering out the sale of its airline business, it seems share and bond holders were less than impressed with the state of Thomas Cook’s growing net debt pile, currently at around £1.2bn. On the day, the shares fell 17%, while debt holders were hit with a material write-down in their notes to 58c to the €1, representing a fall of 14%. The imminent sale of its airline business should provide some relief to its debt; however, such a disposal will be cutting the more cash-generative element of the business.
 
VODAFONE
Index: FTSE 100
Sector: Mobile Telecommunications
Market Capitalisation: £32,955.27m
 
Pension funds and investors alike were struck last week by Vodafone’s decision to cut its dividend, which they heavily rely on. The group slashed its pay-out by 40% in order to support its balance sheet and maintain its earnings coverage to create a more sustainable future for the business. Based on the pre-result closing price, Vodafone’s yield will fall from 9% to a still-respectable 5.9%. Vodafone is currently the 16th-largest holding in the FTSE 100, meaning the reduced dividend will knock pension funds that rely on this income to meet their liabilities.
 
LLOYDS BANKING GROUP
Index: FTSE 100
Sector: Banks
Market Capitalisation: £40,864.13m
 
Lloyds Banking Group made the headlines last week following damning accusations from MPs regarding their top executives’ “boundless greed’”. However, Norman Blackwell, the company’s Chairman, defended the bank’s remuneration policy, stating: “Not many people would do the arduous hours and arduous tasks they do for free”. Nevertheless, shareholders seemed undeterred by the payouts, voting 90% in favour of the most recent pay report and only 7.9% of votes against the policy. Shares were relatively unchanged on the day, observing a 0.87% increase by the market close.

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.
 
There is an extra risk of losing money when shares are bought in some smaller companies as there can be a big difference between the buying and selling price.
 
 
 
Redmayne Bentley’s Top Trades

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