Financial Trading Blog
Stock of the day 17/11/2015 – Ted Baker PLC
After weathering the China-inspired market chaos of August, which caused the stock to linger around the £30 mark until the end of September, Ted Baker managed to climb back to its all-time £34 peaks by the start of October. However, its interim results on October 6th caused the stock fall around 15% across the first half of the month, at one point hitting a 6 month low of £27.26.
(Source: IT-Finance.com 17/11/2015)
Interestingly the figures themselves were very impressive, with a 14.6% increase in half year pre-tax profits to £17.8 million and a 24.5% rise in group revenue to £226.8 million, itself lifted by a 20.1% jump in retail sales to £168.2 million. Yet a warning that trading was softer in August spooked investors, creating the aforementioned negative trading atmosphere that led to those 6 month lows.
Since then, however, investors appear to have reassessed Ted Baker in light of those strong half year figures, especially considering the fact that the early-October report also saw the company announce 6 stores in Mexico following a super-charged performance in the US. In other words, after hitting its mid-October nadir Ted Baker has managed to rise all the way back to a current trading price of £34.05 (IT-Finance.com, 17/11/2015).
In terms of its management statement investors will be looking for further confirmation that Ted Baker’s August ‘softness’ didn’t extend into September and that, more long term, it won’t have affected the company’s full year expectations.
Ted Baker has a consensus rating of ‘Buy’ and an average target price of £33.70.
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