Interactive Investor

FTSE 250’s best and worst shares of 2023

After lagging international rivals in 2023, UK mid-cap shares have generated some of the best returns over the past month. City writer Graeme Evans reveals this year’s top stocks and which one gets the wooden spoon.

21st December 2023 15:35

Graeme Evans from interactive investor

Fallen mid-cap stocks including easyJet (LSE:EZJ) and Wetherspoon (J D) (LSE:JDW) rebounded in 2023 as the FTSE 250 index enjoyed a purple patch as one of the world’s best benchmarks.

The 17% rise for the UK-focused index in the final weeks of the year ranked alongside the S&P 500 index and tech-led Nasdaq as investors bet interest rates will fall next year.

The performance pushed the FTSE 250 index into positive territory for the year, having fallen in 2022 and come under significant selling pressure in the late summer and autumn.

Several of the previous year’s biggest fallers were among the best performers of 2023, including two members of 2022’s unwanted 50% Club.

Cruise ship giant Carnival (LSE:CCL) fell 58.1% last year but there’s been a wave of buying since then to leave shares in the P&O Cruises operator more than double their 2023 starting point.

September’s third-quarter results showed all-time high revenues and advanced bookings for 2024 well ahead of the normal range, with fuel consumption better-than-expected.

JD Wetherspoon also recovered the previous year’s 50%-plus fall as trading continued its pattern of gradual improvement following the end of Covid restrictions. Inflationary pressures have eased, but energy costs remain at far higher levels than pre-pandemic. 

Shares are up 78% in the year, similar to the rise at Mitchells & Butlers (LSE:MAB) after the Harvester and All Bar One owner reported 9.1% growth in like-for-like sales and 17.6% increase in operating profit for the year to 30 September. 

Chief executive Phil Urban said: “While we remain mindful of the pressures that the UK consumer is facing, the strength of our sales growth alongside an abating cost environment gives us confidence for the financial year ahead.” 

One of the biggest beneficiaries of the mid-cap revival since October has been easyJet, with shares in the low-cost airline up 53.5% across the year after a decline of 41.6% in 2022.

The Luton-based carrier reported a record second-half profit in November’s annual results, while the outlook for 2024 has been boosted by signs that travel continues to be a top priority for household discretionary spending. 

Having tapped shareholders for £1.2 billion in 2021’s rights issue, the airline announced plans to resume dividends through the £34 million distribution of 4.5p a share early next year. 

Other FTSE 250 companies to have enjoyed much better years included Baltic Classifieds Group (LSE:BCG), which is now worth £1.1 billion after a jump in value of more than 60% this year, and the Microsoft reseller Bytes Technology (LSE:BYIT) following a gain of 51.6%.

FTSE 250's best-performing shares of 2023

Company

Price

Market cap (m)

Shares in 2023 (%)

Shares in 2022 (%)

One-year change (%)

Current dividend yield (%)

Forward dividend yield (%)

Forward PE

Carnival (LSE:CCL)

1317p

£16,677

127

-58.1

115.0

 

 

 

AO World (LSE:AO.)

95p

£550

82.7

-52.9

71.5

 

 

24.6

Mitchells & Butlers (LSE:MAB)

248p

£1,482

79.7

-46.1

86.9

 

 

12.0

Wetherspoon (J D) (LSE:JDW)

791.5p

£985

78.2

-53.8

90.8

 

0.2

19.9

FirstGroup (LSE:FGP)

166.8p

£1,094

65.1

-1.2

70.0

2.3

2.9

13.4

Baltic Classifieds Group (LSE:BCG)

227.5p

£1,121

61.6

-44.3

70.0

1.0

1.0

29.3

Hill & Smith (LSE:HILS)

1862p

£1,493

58.9

-34.7

58.9

1.9

2.2

18.1

easyJet (LSE:EZJ)

498.3p

£3,753

53.5

-41.6

41.8

 

2.4

9.1

RHI Magnesita NV Ordinary Shares (LSE:RHIM)

3402p

£1,613

53.0

-32.7

64.7

4.0

4.3

8.3

Bytes Technology (LSE:BYIT)

586.5p

£1,405

51.6

-31.8

53.1

1.3

2.4

29.1

Source: SharePad. Data correct as at end of day 18 December 2023.

Among the worst-performing shares, Dr. Martens (LSE:DOCS) fell by more than 50% for a second year in a row as the bootmaker continues to find life tough in the United States.

Having dealt with supply bottlenecks at its Los Angeles distribution centre, chief executive Kenny Wilson warned in November that US trading conditions were increasingly difficult.

The shares, which were priced at 370p when the company was valued at £3.7 billion in its January 2021 flotation, finished the year below 90p.

America has also been a difficult market for publisher Future (LSE:FUTR) after shares recently fell to their lowest level in nearly five years at near to 600p. They have since recovered to 691.5p but that’s still a fall of 45.4% in the year following the decline of 67% in 2022.

The owner of GoCompare as well as Marie Claire and Country Life recently reported a 19% fall in revenues in the United States. It hopes for a return to overall sales growth in the second half of the current financial year.

The worst-performing stock still listed in the FTSE 250 index has been equipment testing firm Spirent Communications (LSE:SPT), which is down 55% after network infrastructure suppliers and operators cut spending in response to the economic outlook.

The stock fell as far as 90p in October but has since recovered to 116p after Spirent expanded its presence beyond telecoms with an agreement with a financial services organisation.

Other big fallers included National Express owner Mobico Group (LSE:MCG), which lost 43.8% on top of the 49.5% decline in 2022. The reversal for the coach operator accelerated after October’s suspension of dividend payments and warning that its profits turnaround is taking longer than expected.

In contrast, the UK-focused bus and rail operator FirstGroup (LSE:FGP) rose 65.1% as one of the year’s best-performing stocks in the FTSE 250 index.

FTSE 250's worst-performing shares of 2023

Company

Price

Market cap (m)

Shares in 2023 (%)

Shares in 2022 (%)

One-year performance (%)

Current dividend yield (%)

Forward dividend yield (%)

Forward PE

Spirent Communications (LSE:SPT)

116p

£671

-55.4

-5.8

-56.0

5.4

3.7

18.0

Dr. Martens (LSE:DOCS)

89.45p

£860

-53.1

-55.5

-50.3

6.5

6.5

11.0

Ferrexpo (LSE:FXPO)

77.15p

£462

-50.9

-47.5

-51.6

13.5

2.9

12.2

Future (LSE:FUTR)

691.5p

£802

-45.4

-66.9

-45.0

0.5

0.5

5.6

Mobico Group (LSE:MCG)

73.1p

£449

-43.8

-49.5

-48.3

6.8

4.3

8.1

Diversified Energy Co (LSE:DEC)

1310.5p

£631

-43.7

11.5

-43.7

21.6

21.1

4.5

PureTech Health (LSE:PRTC)

150.6p

£410

-43.5

-8.7

-44.4

 

 

 

FDM Group (Holdings) (LSE:FDM) 

425p

£466

-43.3

-41.1

-43.5

8.5

8.5

12.5

Indivior Ordinary Share (LSE:INDV)

1135p

£1,554

-38.7

44.1

-36.6

 

 

10.4

Jupiter Fund Management (LSE:JUP) 

86.75p

£473

-34.7

-48.2

-30.6

9.7

10.5

7.1

Source: SharePad. Data correct as at end of day 18 December 2023.

These articles are provided for information purposes only.  Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties.  The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

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