Today I am looking at four FTSE shakers in Tuesday business.
ARM Holdings
Concerns over market saturation in the tablet computer and smartphone segments were given further fuel following Taiwanese manufacturer HTC’s latest financials released overnight. The phonebuilder announced a net loss of $138m during July-September, swinging from a profit of $19.7m a year earlier as sales fell off a cliff — total revenues slumped to $658m from $1.29bn previously, a situation not helped by intensifying competition.
Shares in microchip creator ARM Holdings (LSE: ARM) have shed 1.6% in Tuesday business following the news, but I believe investors shouldn’t lose their nerve. The Cambridge firm is a critical supplier to Apple, a company that continues to enjoy electric sales growth the world over, while ARM Holdings is also a major player with China’s emerging tech giants. I therefore expect chip sales at the business to continue rising, helped by diversification into other hot tech areas.
easyJet
Budget flyer easyJet (LSE: EZJ) also dipped during Tuesday’s session, albeit by a far-more-modest 0.3%. This is despite the company advising that it carried 6.61 million passengers during September, up 7.6% on an annual basis. Traveller traffic continues to pick up the pace at the Luton business — on a 12-month rolling basis, passenger numbers rose ‘just’ 6% to the close of last month.
The airline continues to expand the number of bases and routes it operates, and in September announced plans to increase the number of flights it operates between the Scottish Highlands and its London hubs between next March and June. And helped by improving economic conditions across the continent, I expect seat demand at easyJet to keep ascending in the coming years.
UK Mail Group
Parcels play UK Mail (LSE: UKM) cheered the market with its latest financial update, and the business was recently 7.8% higher from Monday’s close. The firm has seen its share price tank by more than a quarter since the start of August, prompted by a profit warning after the move to its new Coventry hub “caused a greater level of customer churn and loss of volume than anticipated.”
So today’s announcement that trading during April-September “is in line with our revised expectations” has boosted investor faith in UK Mail’s decision to relocate its facilities. On top of this, the courier announced that average daily parcel volumes had risen 8% in the period from a year earlier, thanks in no small part to the growth of e-commerce. And I believe traffic should continue rising at UK Mail as internet shopping activity ticks steadily higher.
Acacia Mining
Resources play Acacia Mining (LSE: ACA) has suffered a calamitous fall in Tuesday business and was last dealing 13.6% lower from the prior close. The gold producer announced that output of 164,000 ounces during July-September fell short of expectations, forcing the business to downscale its full-year estimates to 718,851 ounces, matching 2014’s production.
Acacia Mining had previously expected to produce between 750,000 and 800,000 ounces in the current period, and the poor result caused net cash to decline by $45m to just $100m as of the close of September. The company has responded by vowing to slash costs still further, but should fresh production problems occur — or gold prices shuttle lower again — I believe Acacia Mining could find itself in a very sticky place.
