Financial Trading Blog
Stock of the day 02/10/15 – Ted Baker PLC
Can that run continue following its interim results statement next Tuesday?
The company hitting the ground running in 2015, opening the year at £21.92 before the announcement of a 22.8% increase in sales across the Christmas period put the stock on track to hit the £25 mark for the first time in the company’s history by the middle of February.
That wasn’t to be the last time Ted Baker hit new-highs in 2015; by the middle of March the stock had reached £29.14, driven by an 18.4% rise in full year retail sales to £306.9 million alongside a 20.4% increase in pre-tax profits to £49.5 million, with good progress made in its recently opened Saudi Arabia and Abu Dhabi stores.
(Source: IT-Finance.com 02/10/2015)
A wave of profit-taking appeared to push Ted Baker away from its post-full year highs (all the way down to £24.75) only for a sharp recovery at the start of April to put it back above the £28 mark. The stock traded laterally across the rest of April and May, with the post-UK election boost failing to be sustained.
However, its impressive update in June soon restored investors’ appetite for Ted Baker’s wares, with the company attributing its 18.9% jump in sales across the 18 weeks to June 6th to robust trading in the US. Despite a minor-tumble at the start of July, due to the market-wobbling Greek saga, this update caused Ted Baker to surge beyond the £30 mark, eventually hitting a 2015, and therefore all-time, high of £34.31 by the middle of August.
The Chinese chaos in the second half of that month then took Ted Baker from this peak, with investors worried over the impact of China’s economic slowdown on the company’s recent expansion in the country. Yet Ted Baker soon recovered from its dip below £30, and a strong end to September has left the stock at a current trading price of £33.18 (IT-Finance.com, 02/10/2015).
Ted Baker has a consensus rating of ‘Buy’ with an average target price of £32.20.
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