MARKET REPORT: B&M Poised for Success After Wilko Collapse
B&M shares experienced a boost as industry analysts predicted that the company would strengthen its position within the discount retail sector following the collapse of Wilko. Throughout the past decade, bargain stores have become increasingly popular among consumers, and B&M has seen significant growth in sales and profitability, particularly during the pandemic.
Deutsche Bank Research advised clients to invest in B&M shares, stating that the Wilko administration presented an opportunity for B&M to gain market share. The report also highlighted the acceleration of new store openings in both the UK and France.
As a result of this positive news, B&M shares rose by 3% to 554p. However, the FTSE 100 fell by 0.23%, and the FTSE 250 was down by 0.2%.
Miners experienced pressure due to China’s economic rebound stalling, with Country Garden, the country’s property powerhouse, also facing challenges after missing bond payments. Anglo American, Antofagasta, and Glencore all saw drops in their share prices.
On a more positive note, Plus 500 saw a 1% increase in share price, accompanied by plans to return £94 million to shareholders through dividends and a new share buyback program. Jefferies analysts pointed out that Plus 500 has already returned £1.5 billion in profits to shareholders since its flotation in 2013.
Harvest Minerals, however, saw a decline in share price after reducing its sales forecast due to factors such as delayed orders from farmers, low crop prices, and soaring energy costs.
Persimmon, a housebuilder, also faced challenges, with target price downgrades from Jefferies and Citigroup leading to a 3% drop in share price.
Lok’nStore, a company that rents self-storage units, experienced a 5.3% increase in revenue and a 6.8% increase in prices, indicating a strong position in the UK self-storage market. Despite this positive news, share prices fell by 1.9%.
Simon Cooper, the founder and former CEO of On the Beach, increased his stake in the package holiday group, resulting in a 13.9% rise in share price.
Nanoco saw a 7.8% increase in share price after shareholders voted down a proposal to remove the company’s board. TBC Bank, a Georgian retail lender, also experienced a record high in share price after Peel Hunt reaffirmed its ‘buy’ rating on the stock.
Overall, B&M appears well-positioned to capitalize on the demise of Wilko, and the company’s future prospects in the discount retail sector are promising.
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