Why Standard Life Plc, Pearson plc and NMC Health PLC Should Lag The FTSE 100 Today

The FTSE 100 (FTSEINDICES: ^FTSE) looks to be heading for its fifth winning session in a row, and its third this week, having reached a new five-month high of 6,820 points this morning. By just after midday it had slipped back a few points from that to 6,805, which is only 71 points short of May’s 13-year record of 6,876.

But though the FTSE was boosted by nice rises from some of its top constituents, not everyone is having a good day — here are three from the indices that are slipping back:

Standard Life

Life insurer Standard Life shares took a 14p (3.8%) dive today to 355p, despite a 9% rise in assets under administration to £237.6bn in its third quarter after a net inflow of £7.7bn, together with a 15% rise in fee-based revenue to £1,059m. The problem is, these figures came in slightly below analysts’ forecasts, and markets these days do tend to expect things to be better than expected.

But even after that fall, the shares are still up close to 30% over the past 12 months, easily beating the FTSE, and there’s a better-than-expected dividend yield of 4.3% predicted.


Shares in Pearson took a tumble after the publishing giant’s nine-month update told us that adjusted operating profit for the full year should be lower than 2012, due to the costs of the Penguin Random House merger and to a weak North American education market — by midday, the price was down 37p (2.7%) to 1,328p.

But other than that, things seem to be broadly following earlier expectations. Full-year adjusted earnings per share should be about the same as last year’s 82.6p, which reiterated Pearson’s earlier guidance and is in line City predictions. Full-year restructuring costs should be approximately £150m, lowered to £100m after expected cost savings.

NMC Health

Looking to the FTSE 250 now, NMC Health (LSE: NMC) shares suffered a 12p (3.3%) fall to 355p despite a positive-looking third-quarter update. For the three months to 30 September, the United Arab Emirates private health firm saw total revenue up 10.6% to $136.5m, after bed capacity rose 13.5% with occupancy levels rising to 60.2% from 59.4% a year previously.

Net debt has reached $66.7m, but that was in line with expectations.

Despite today’s fall, the share price has still doubled over the past 12 months, putting the shares on a forward P/E of 16 based on full-year forecasts.

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 5.5% yield and which could be set for some nice share-price appreciation, too?

All you need to do is get a copy of our report, "The Motley Fool's Top Income Share" -- it's completely free of charge, but it will only be available for a limited period. Click here to enjoy your copy today.

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