Financial Trading Blog
Stock of the day 23/03/2015 – A.G. Barr PLC
The company, which also produces Lipton Iced Tea, Tizer and Orangina, as well as its own brands of Lemonade and Cherryade amongst others, had a rather flat 2014 on the markets, opening the year at £5.68 and ending at £5.87. However, since the New Year Barr has seen very steady growth in the first quarter. It started the year at £5.85 before dipping to £5.74 on January 6th, its lowest close of the year so far. After this wobble the stock kept climbing, closing at £6.81 at the start of March after spiking to an intraday high of £7.26. A mid-March slump ate into these gains, but the stock has recovered and is now trading at £6.74.
It has been a busy 12 months for A.G. Barr, with the soft-drinks company confident in its full year release on Tuesday. Barr claims sponsoring the Glasgow Commonwealth Games last summer helped push its brand awareness beyond the localised areas in Scotland where drinks like Irn-Bru are so prevalent. In fact, the company has been making significant gains in this area, with its new(ish) factory in Milton Keynes helping Barr establish a larger presence in the south of the UK.
On top of this comes the recent announce that Bovis Home boss David Ritchie has joined the company as a non-executive direction, alongside the more significant news that A.G. Barr acquired cocktail company Funkin for £21 million back in February. This acquisition is likely to draw focus when it comes to scrutinising Barr’s full year release, as it moves the company into slightly unfamiliar, if potentially lucrative, territory.
However the main draw, of course, will be Barr’s headline figures, and analysts are expecting a very good 2014 for the company. Pre-tax profits are predicted to see 9.2% growth to £41.6 million from £34.4 million in 2013, largely due to a fourth quarter surge, with a 2% growth in sales seeing an increase to £259 million. This, according to forecasters, should make up for the heavily discounted promotions A.G. Barr ran in the second half of 2014, and leave the company in a strong position going forwards.
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