The quarterly revision of the FTSE All Share Index is based on today’s closing prices and will be announced on Wednesday, December 1, with changes effective after the close on Friday, December 17.

– A sparkling performance by Electrocomponents pushes you into a prime position to move in the FTSE 100.

– Dechra Pharma, other FTSE 100 contender has seized the opportunity of the growing popularity of pets.

– Cybersecurity firm DarkTrace ready to slip out of the FTSE 100 after a stock drop when the fixed initial public offering period ended.

– Johnson Matthey position in the FTSE 100 seems shaky after he abandoned his drumming plans.

– Supply chain problems affect electricity retailers AO World as it looks like it’s going to slide from FTSE 250.

– Petershill Partners eyes up a FTSE 250 and new acquisitions of private equity assets.

– New Covid issues hit The restaurant group as it looks like it’s going to slide out of the FTSE 250.

Susannah streeter, senior investment and markets analyst, Hargreaves Lansdown summarizes the brokers and corridors:

Electrocomponents – aspiring to enter the FTSE 100

” The sparkling performance of Electrocomponents, with adjusted earnings before taxes increasing 91% during the first half of the year, has led to an increase in its share price, placing it in a prime position to move to FTSE 100 territory. The broad range of industrial and electronic products owned by the distributor is in part behind its success, as well as its smooth online operations serving the lucrative business-to-business segment. It hasn’t been immune to higher shipping and labor costs and global supply chain woes, but it appears to have skillfully managed its inventory and kept margins intact. Although there are likely to be more cost pressures in the future, Electrocomponents appears in a strong position, especially considering that the demand for electrical parts shows few signs of diminishing. ”

Dechra Pharma – contender to enter the FTSE 100

”Dechra Pharma has seized the opportunity of the growing popularity of pets during the pandemic. Its share price has skyrocketed and it is one of the main competitors to take a walk around. FTSE 100. With so many people working from home, it has been an ideal opportunity to settle into a new furry friend and Dechra it is in the business of keeping them healthy throughout their lives. Demand for the pharmaceutical company’s veterinary products has been strong, and full-year results show pre-tax earnings nearly doubled. There is a risk that with incomes facing a contraction from rising inflation, per capita spending could decline, so there could be headwinds to navigate. But other results from pet-oriented companies indicate that demand for pets does not appear to be declining, which bodes well for future revenue streams. ”

Darktrace – it is likely to be degraded from FTSE 100

” Cybersecurity firm Darktrace it made a stealthy entry into the top flight in the latest shakeup, but is one of the main contenders to leave the blue chip index as stocks have fallen 52% since hitting a record high in September. This appears to be due to the end of the post-IPO lockdown period, with large amounts of new stocks flooding the market and causing the falls. Darktrace You are not alone in being an IPO favorite, you are now experiencing the pain of a rapid slowdown in your share price. Its successful launch in the spring was seen as a blow to the London market, and if it leaves the top category it will leave a large technological gap in the FTSE 100. However, given the continued growth reported by the company and some fairly optimistic business updates, it may not be left out of the top category for long. There is a growing demand for sophisticated technology to counter the growing armies of cybercriminals and Darktrace uses AI to scan regular business operations and detect minor irregularities, providing an early warning system for cyber attacks. The ongoing shift to digital is likely to continue to open up new opportunities and markets for Darktrace as companies expand their operations to meet demand, while trying to ensure their systems remain secure. ”

Johnson Matthey – it is likely to be degraded from FTSE 100

” Investors are clearly concerned Johnson Matthey strategy for the future and in the midst of this uncertainty, the company runs the risk of FTSE 100. The engineering firm’s decision to abandon its plans to become a battery supplier by selling its eLNO business sent the shares down, as it appeared to be JMAT’s response to the shift towards electric vehicles and away from combustion engines. , for which you manufacture catalytic converters. Management says it will focus on other avenues of potential growth, but ultimately the group will start from scratch as it seeks new opportunities alongside the new greener auto industry. Although catalytic converters will not be immediately obsolete, time is ticking and, as the transition to electric vehicles accelerates, Johnson Matthey you will need to quickly find a new sense of direction. ”

AO World – it is likely to be degraded from FTSE 250

” Online Electricity Retailer AO World was well set up to capitalize on the accelerated shift to e-commerce during the early stages of the pandemic, with skyrocketing gains as demand for home appliances and IT equipment increased. But the company has hit the ground with a bang, falling to a loss of £ 10 million in half a year, sending stocks plummeting, and this dramatic reversal of fortunes is likely to see it thrown out of the loop. FTSE 250. Its rapid growth appears to have been part of the problem, given that it has not had as much time to build deep relationships with suppliers, so when the supply crisis hit electrical products, it was lower on the priority list. Higher labor and transportation costs, exacerbated by driver shortages, have also reduced margins, given that it relies so heavily on its delivery network to make sales and provide aftercare. Rapid change is unlikely as the company has warned that the crucial Christmas trading period will be difficult and supply chain issues will persist, so AO World it may be difficult to get back up the ladder FTSE 250 territory for some time. ”

The restaurant group – it is likely to be degraded from FTSE 250

“As fears about the Omicron variant mount, new concerns arise that restrictions may be tighter on hotel companies and The restaurant group it has not escaped this new round of volatility. Although stocks have risen marginally today, they are down 35% over the past month as investors worry that despite a large round of cost cuts and a shrinking footprint in restaurants, a large recovery from fortunes remains elusive. Although its flagship brand Wagamama is serving fast food as fast as it can reach crowds queuing outside restaurants or ordering from home, its airport concessions arm has struggled with a 53% drop in comparable sales in the last trimester. reading, as tourism has been slow to recover. Like many other companies in the industry, the company is also facing the challenges of higher costs and salary pressures, amid a staff shortage and those problems seem to persist. ”

Provident Financial – aspiring FTSE 250

” Provident Financial, the sub-prime known for its specialization in credit cards, online loans, and consumer auto financing, is likely FTSE 250 after its valuation recovered as the business turned around. The company asked for time in its home loan business earlier this year as part of its attempt to break out of a financial black hole, after being forced to pay compensation for the improper sale of its products. Shifting its business model from riskier, high-interest loans to a mid-cost credit model is now a more important focus for the company and is a direction that travel investors have taken. Although the gloss has emerged in the stock price in recent days, which may be partly due to fears that if the new variant leads to another recession, bad loan potential could rise, stocks are still climbing 41. % in the last six months. . ”

Petershill Partners – contender for the FTSE 250

‘Petershill Partners only started trading on the London Stock Exchange in September, but he is already one of the main contenders to enter the FTSE 250. Petershill owns minority interests in a variety of alternative asset managers, such as venture capital firms and private equity companies, many of which had been managed by Goldman Sachs for a decade or more. The investment firm’s assets under management increased 8% in the third quarter, and it has its sights set on new rewards with new acquisitions being evaluated. Petershill has taken advantage of the hunger for private equity investments in an era of ultra-low rates, allowing companies to borrow cheaply to finance acquisitions. With a rise in interest rates looming, there is a risk that the appetite for such assets will decline, and that could partly explain a slight downward push in share prices over the past month. ”

NOTES TO EDITORS

Media contact:

Susannah streeter

Senior Investment and market analyst, Hargreaves Lansdown

[email protected]

07527 384747

@StreeterNews

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