Why InterContinental Hotels Group PLC, William Hill plc and Balfour Beatty plc Should Lag The FTSE 100 Today

InterContinental Hotels Group PLC (LSE: IHG), William Hill plc (LON: WMH) and Balfour Beatty plc (LON: BBY) are falling today.

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The FTSE 100 (FTSEINDICES: ^FTSE) is bobbing up a bit today, gaining 17 points to reach 6,547 by late morning, after positive noises from China gave the mining sector a boost. After factory output in the People’s Republic rose 9.7% in July compared to a year previously, with inflation steady at 2.7%, the signs are that the country’s slowdown is coming to an end.

But it’s not good news for everyone. Here are three companies whose share prices are falling behind the FTSE today:

InterContinental Hotels

Hotels and travel agents are in the news today, after the Office of Fair Trading (OFT) updated us on its investigation into the online selling of room-only hotel accommodation. The OFT has entered a public consultation regarding commitments designed to bring the investigation to an end “without finding of infringement or the imposition of any fine“.

InterContinental Hotels Group (LSE: IHG) was one whose share price was affected, losing 21p (1.1%) to 1,957p, although the company released its own announcement saying it has worked closely with the OFT to agree the proposed commitments. The downtick today comes after a healthy rise earlier this week in response to strong first-half results.

William Hill

William Hill (LSE: WMH) today announced the acquisition of the Australian online betting firm Tom Waterhouse, the operator of tomwaterhouse.com, and saw its share price drop 1.7p (0.4%) to 445p in response. The deal will cost A$34 (£20m), and will involve William Hill taking on £3m in balance sheet liabilities. Up to a further A$70m could be payable, depending on operating profit targets between now and 2015.

William Hill shares had spiked upwards earlier on the release of upbeat first-half results, and despite a fallback since then, the price is still up more than 50% over the past 12 months. Forecasts suggest two more years of rising earnings and put the shares on a P/E of 15.

Balfour Beatty

News of a disposal didn’t help Balfour Beatty (LSE: BBY) shares, which lost 22p (0.8%) to 242p this morning. The firm is to sell its UK facilities management business to GDF Suez Energy Services for £190m in cash — though that may be reduced by any debt carried with the deal.

The proceeds will be used to reduce borrowings, as the struggling infrastructure group is forecast to see a reduction in earnings per share this year of more than a third. Balfour Beatty shares are down around 18% over the past 12 months.

Finally, you can compensate for the day-to-day ups and downs of share prices by looking for reliable dividends. So how would you like a company that’s offering a 5% yield and which could be set for some nice share price appreciation too?

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> Alan does not own any shares mentioned in this article.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

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