Aston Martin and Howden Joinery

“Markets around the world take a step back amid disappointment over Donald Trump’s failure to reach a deal with North Korea and weak manufacturing data from China. The FTSE 100 was also hit by several large companies trading without the rights to the latest dividend including AstraZeneca and Micro Focus,” says Russ Mould, Investment Director at AJ Bell.

Aston Martin

“It may still be James Bond’s favourite model but shares in luxury car maker Aston Martin Lagonda appear to have real engine trouble. And its first set of full year results as a quoted company don’t help matters, revealing it spent a weighty £136m to list in London last year.

“It tips the company into a £70m loss for 2018 leaving shareholders both shaken and stirred. The group has lost more than a third of its market value since joining the UK market in October.

“The complications of Brexit loom for Aston Martin just as they do for other car manufacturers, reflected in the £30m it has set aside to weather any disruption. Underlying earnings in the first half of 2019 are set to be lower.

“So why does chief executive Andy Palmer describe last year as an ‘exceptional’ one for the group? Well it did post record revenue of more than £1bn with volumes ahead of guidance, but today’s negative market reaction suggests it has a lot more to do to win over the sceptics.”

Howden Joinery

“Kitchens seller Howden Joinery is often cited as a high quality company which consistently generates decent returns on the money it invests in its business.

“This reputation means its share price can be punished hard at the slightest bit of bad news. That’s exactly what’s happened today.

“Margins have slipped, trading since the start of 2019 looks fairly lacklustre, it has guided for a £15m increase in operating costs, and it has incurred a £3.8m pension equalisation charge.

“There is also a sense of nervousness about various elements of its statement which may lead investors to worry as well.

“It is stockpiling inventory worth £15m in case of any Brexit-related supply interruptions.

“A £50m share buyback over the next two years also doesn’t scream major confidence about the future. It has a £231m net cash position and the business is highly cash generative so it could have been more generous. This suggests Howden wants to have a financial cushion in case trading becomes more difficult.”

These articles are for information purposes only and are not a personal recommendation or advice.