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FTSE 250 movers: Close Bros surges on Berenberg note; Trustpilot slides

15:41, 20th March 2024

(Sharecast News) - FTSE 250 (MCX) 19,494.45 0.32%

Review platform Trustpilot slumped after Vitruvian Partners sold 15.5m shares in the company in a placing at 200p each, versus a closing price of 208p on Tuesday.

Berenberg, which conducted the accelerated bookbuild, said on Wednesday that the size of the placing was increased from the 12.5m originally proposed due to "strong investor demand".

The placing shares represent around 3.7% of the company's issued share capital and the price is a discount of 3.8% to the closing share price on Tuesday.

At 0855 GMT, the shares were down 7.1% at 193.25p.

Trustpilot said on Tuesday that it swung to a profit in 2023 as revenue and user numbers jumped.

In the year to the end of December 2023, the review platform swung to a profit of $7.1m from a loss of $14.6m the year before as revenue rose 18% to $176m.

Adjusted earnings before interest, tax, depreciation and amortisation came in ahead of expectations at $15.5m, versus a loss of $4.4m a year earlier.

Bookings were up 18% to $195m, with 22% growth in Europe and Rest of World, 17% growth in the UK and a 12% gain in North America.

Annual recurring revenue grew 22% to $197m and monthly unique users on the platform rose 30% to more than 57 million.

On the upside, Johnson Matthey surged as it announced the sale of its medical device components business to Montagu Private Equity for $700m (£550m).

The business makes parts for medical device manufacturers globally with a focus on precious metal alloys and nitinol. It operates manufacturing sites in the US, Mexico, and Australia.

Johnson Matthey also said it had now finished the divestment programme announced in May 2022, bringing aggregate net proceeds from sales to "significantly more" than its target of £300m.

Shares in Close Brothers Group continued to surge on Wednesday after the merchant bank's first-half results in which the company eased investors' concerns about an upcoming regulatory probe, with Berenberg providing an extra boost after lifting its target price for the stock.

The stock was up 8.5% at 376.64p by 1106 GMT, following a 2.9% jump the previous session after the company announced a raft of measures - including the suspension of dividends - to strengthen its capital position by £400m as it prepares for the conclusion of a Financial Conduct Authority investigation into motor finance, which centres around so-called discretionary commission arrangements. Through DCAs, lenders allowed motor dealers to use their discretion to land on interest rates within a certain range, leading to claims that consumers had been over-charged for car loans between 2007 and 2021.

Berenberg said that actions, which could provide around 390 basis points of capital support, "help to alleviate risks to the bank's potential large and uncertain motor finance redress costs".

The broker added: "While uncertainty remains high, with the bank's share price still down c55% ytd, growth in Close Brothers' core businesses is also reassuringly resilient."

Berenberg upped its target price from 425p to 470p, saying it now values the bank at 0.4 times tangible book value, up from 0.3 times currently.

"We maintain our 'buy' rating, but acknowledge risks may be too great to bear for many investors."


Market Movers

FTSE 250 - Risers

Close Brothers Group (CBG) 393.40p 13.24%
Johnson Matthey (JMAT) 1,857.00p 8.76%
Essentra (ESNT) 176.20p 6.53%
Marshalls (MSLH) 276.00p 4.94%
Mobico Group (MCG) 70.15p 4.23%
Discoverie Group (DSCV) 701.00p 4.01%
Investec (INVP) 508.20p 3.50%
PPHE Hotel Group Ltd (PPH) 1,435.00p 3.24%
W.A.G Payment Solutions (WPS) 74.80p 3.03%
Ibstock (IBST) 148.50p 2.56%

FTSE 250 - Fallers

Trustpilot Group (TRST) 191.00p -8.17%
Watches of Switzerland Group (WOSG) 342.60p -6.50%
Ferrexpo (FXPO) 44.78p -5.81%
Computacenter (CCC) 2,774.00p -5.71%
C&C Group (CDI) (CCR) 150.60p -3.46%
Dr. Martens (DOCS) 87.15p -3.01%
PureTech Health (PRTC) 217.50p -2.47%
OSB Group (OSB) 368.60p -2.33%
Octopus Renewables Infrastructure Trust (ORIT) 74.90p -2.22%
Softcat (SCT) 1,527.00p -2.12%


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The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.

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