Newspaper publisher and information services firm Daily Mail & General Trust (DMGT) gains 8.3% to 826p as full year results come in ahead of expectations, leaving scope for upgrades to 2017 forecasts.
AHEAD OF THE GAME
We flagged the company ahead of these results back in October and, as we predicted, recently appointed chief executive Paul Zwillenberg revealed plans to further streamline the business. Adjusted earnings per share (EPS) for the 12 months to 30 September comes in at 56p versus the 52.7p pencilled in by consensus.
In the absence of detailed guidance from the company itself the adjusted EPS forecast for September 2017 is lower than the number reported for 2016 at 55.7p. But the company should enjoy a currency tailwind, with 40% of its profit in the US, and see continuing benefits from restructuring so these forecasts will likely have to be hiked.
ASSET SALES
Liberum analyst Ian Whittaker has a ‘buy’ recommendation on the stock and 950p price target: ‘DMGT beat FY'16 consensus expectations and we expect consensus FY'17E upgrades.
Perhaps the more interesting, fundamental comments surround what they talk about in their strategy piece - as we suspected, DMGT looks to be conducting a portfolio review which will lead to a more focused business and which (we think) will likely involve some asset sales.’
