Greencore claws back ground but the short-sellers remain in force
EMBATTLED sandwich maker Greencore started to claw back ground lost in Tuesday’s 30pc plunge but new short disclosures revealed that hedge funds are predicting that more pain lies ahead for the FTSE 250 struggler.
Short-sellers made just under £40m on paper from Tuesday’s nosedive but instead of cashing in on Greencore’s woes four hedge funds have since ramped up their bets against the world’s biggest sandwich producer.
Greencore has struggled to expand its US business and issued a profit warning this week as it invests an extra £3m to restructure its ailing unit in the States.
It has surged up the shorts leaderboard with the number of its shares out on loan to hedge funds more than doubling to 10.83pc, a stake worth £103m.
But bargain-picking investors ignored warning signs from hedge funds and downbeat broker notes from Shore Capital and Berenberg to boost Greencore 5.7p to 134.4p.
Elsewhere, telecoms struggler Talktalk slipped 2.4p to 107p after JP Morgan analysts warned that it’s “too early” to back the FTSE 250 firm’s turnaround plan.
In a 20p price target cut to 100p, its analysts told clients that it was “encouraged” by Talktalk “going back to its roots” but believes that the company will prioritise growth ahead of earnings. Investor darling Fevertree Drinks struggled despite RBC Capital Markets becoming the latest broker to put the mixer maker’s shares on its “buy” list, nudging down 2p to £29.
RBC argued that fears that the relaunch of premium tonic Schweppes 1783 would threaten Fever-tree’s crown in the UK mixer market have proved unfounded, and the US is showing “important similarities with where the UK was a few years ago”.
A retail sector healthchecker indicating that high street sales failed to rebound following the “Beast from the East”, with another cold snap on its way, weakened Mothercare
1.3p to 17.1p, a fresh all-time low as fears mount over its refinancing talks with lenders.
NEX shares skyrocketed 204p to 874p after the fintech firm revealed that it has become a takeover target for US exchange giant CME. The company confirmed yesterday that it was in talks with CME but warned that there is no guarantee of a firm offer, with City grandee Michael Spencer set for a bumper payday from his 17.5pc stake. Financial services giant
Old Mutual dipped 4p to 249p after selling its Latin American businesses to China Minsheng Investment Group International.
Oil prices spiked ahead of weekly rigs data from the US, with energy giants Royal Dutch Shell ‘B’ and BP climbing 28p to £22.49 and 9.2p to 473.8p, respectively, as Brent crude touched over $66 per barrel for the first time in 10 days.
Housebuilding stocks tumbled to the bottom of the FTSE 100 leaderboard after Berkeley’s refusal to raise production levels spooked investors. Markets ended a turbulent week on a firmer footing with the UK’S blue-chip index advancing 24.38 points to 7,164.14.