Shares round-up: Spectris, Luceco, Watkin Jones, Ashtead Tech
There are some big moves outside the FTSE 100, among them the best performer in this year’s Wild’s Winter Portfolios. City writer Graeme Evans explains the catalysts.
23rd January 2025 14:21
by Graeme Evans from interactive investor
Industrial-focused stocks dominated the top of the FTSE 350 index today after Spectris (LSE:SXS) boosted confidence with an update revealing it ended a tough year on a stronger note.
The precision instrumentation firm rallied 278p to its highest level since September at 2978p, followed by Rotork (LSE:ROR), Morgan Advanced Materials (LSE:MGAM), Oxford Instruments (LSE:OXIG), and Weir Group (LSE:WEIR).
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A brief update by Spectris highlighting “strong trading and operational execution” in the fourth quarter contrasted with the company’s warning on 31 October that the recovery in its markets was taking longer to materialise.
It gave no further detail on trading progress but said today that operating profits on 28 February will be at the upper end of the City’s forecast range between £183.3 million and £201 million.
That’s still a sharp fall from 2023’s £262.5 million after continued softness in China, pharmaceuticals and academia left like-for-like sales 10% lower by the autumn.
Chief executive Andrew Heath said in October that weakness was expected to persist into 2025 but that decisive action on costs and strategy left Spectris well placed for when markets recover.
Spectris always expected 2024 to be a slower year, before returning to growth in 2025 and 2026 as it benefited from major acquisitions such as Boston, Massachusetts-based SciAps.
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The move for the specialist provider of handheld instruments used in materials analysis bolsters the company’s position in markets including mining, batteries and pharmaceuticals.
The shares are down 15% in the past year but have a strong track record of performing well over the winter months, having delivered growth for nine of the past 10 years at an average return of 15%.
That performance - with the blip coming in 2021 - means Spectris has been included as one of the five stocks in this year’s edition of Wild’s Consistent Winter Portfolio.
In the FTSE All-Share, Luceco (LSE:LUCE) jumped 14.8p to 140p after the supplier of wiring accessories, EV chargers, LED lighting and portable power products forecast 2024 results ahead of market expectations.
It said an improving trend in order intake experienced in the third quarter accelerated through the final quarter, while its residential electric vehicle charger division has continued to outperform after year-on-year growth of 50%.
Annual revenues for the group are set to be £240 million, which compares with City forecasts of £234.2 million and 2023’s £209 million. Operating profit will be in the region of £28.5 million-£29 million, up from £24 million.
Chief executive John Hornby said: “We look forward to further growth in 2025, hopeful of improved end-market demand, but confident that the group is well positioned to make solid progress against its strategic objectives."
Deutsche Numis highlighted a price target of 205p, adding that a 40% valuation discount to the company's peers looked unwarranted given recent trading momentum.
On AIM, stocks on the recovery trail included Watkin Jones (LSE:WJG) after the developer and manager of residential properties for rent reported 2024 results showing a forecast-beating upturn in its profitability and net cash position.
Revenue declined 12% to £362.4 million but the successful completion of six schemes contributed to a return to profit at £9.2 million. The shares rose 4.7p to 24.6p, still 46% lower over the past year.
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Progressive Equity Research highlighted signs of recovery in the investment market and a significant pipeline of potential new rental properties.
It said: “These should translate into revenue and profit once there is clearer visibility on rate cuts, and we believe greater clarity on timing should emerge at the half-year results.”
Ashtead Technology Holdings Ordinary Shares (LSE:AT.), the subsea equipment rental provider for the offshore energy sector, surged 70p to 626p after it forecast 2024 revenues of £168 million and adjusted earnings ahead of the City consensus.
It said the strong finish to 2024, ongoing market demand and record customer backlogs gave it confidence that growth will continue through 2025 in line with previous guidance.
Broker Peel Hunt said the update was further evidence of management’s ability to deliver strategic, operational and financial progress. It has a 850p price target, believing the shares offer “compelling value”.
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