Thanks to the optimism surrounding the vaccine rollout, many members of the FTSE 250 are now trading close to or above their pre-coronavirus crash levels. Today, I’m looking at three examples, all of which are due to provide updates to the market next month. Is the good news now priced-in?
Tritax Big Box
Shares of real estate investment trust Tritax Big Box (LSE: BBOX) have been in fine form of late. Anyone snapping up the warehouse provider roughly 11 months ago would have more than doubled their money.
I’m not sure we should be surprised by this performance. After all, the boost to online shopping as a result of the coronavirus means many companies are desperately looking for warehouse space to expand their digital footprints.
In addition to this, I’ve long been bullish on Tritax as a source of dividends. Analysts are expecting the company to return 6.71p per share in the 2021 financial year. That becomes a yield of 3.7% at the current share price. That’s certainly not the highest income stream available in the FTSE 250. However, based on the firm’s growth prospects, I would think it’s one of the most secure.
A downside to all this is that the shares are changing hands for 26 times forecast earnings. That’s not cheap, arguably making the stock riskier than it first appears. With this in mind, I can’t see Tritax moving all that much higher in value when full-year results are announced on 10 March.
Sausage-roll seller Greggs (LSE: GRG) releases its latest set of full-year numbers to the market on 16 March. Like Tritax, its share price has been on a tear of late, helping to justify my ‘buy’ call on the stock last year.
Is the stock now in danger of overheating? It’s a tricky one to call. As things stand, high streets are still deserted and could remain that way if Boris Johnson’s roadmap doesn’t go to plan. Then again, more positive news flow on the pandemic over the next few months could quite reasonably send the shares higher.
As a committed long-term investor, I doubt I’ll be jettisoning my shares in Greggs next month. Even so, I’m hoping recent momentum will continue.
One reason to be optimistic is that the company has already sought to keep expectations low. Back in January, it said that profits were unlikely to return to pre-COVID levels until 2022 at the earliest. Under-promising and over-delivering is never a bad strategy in my book!
A final FTSE 250 share worth watching in March is Computacenter (LSE: CCC). The £2.5bn cap has been a huge beneficiary of the increased demand for IT infrastructure support over the pandemic.
CCC releases full-year results on the same day as Greggs. While I don’t expect any bad news, it will be interesting to see how the market reacts given that the shares have already doubled since the market crash.
Back in January, the company increased its guidance on full-year adjusted pre-tax profit for the second time in as many months. It also said that trading momentum since the coronavirus first began wreaking havoc showed “no sign of abating”.
Of course, there’s a chance CCC’s valuation already reflects this. As such, I’d be wary of assuming the shares will automatically hit another record high next month. The shares currently trade on 18 times earnings.
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Paul Summers owns shares of Greggs. The Motley Fool UK has recommended Tritax Big Box REIT. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.