LONDON (SHARECAST) - Electrical components distributor Electromponents and bourses operator London Stock Exchange (LSE) are doing battle for the wooden spoon among FTSE 250 stocks.
Electrocomponents is sharply lower after issuing a profits warning. The consensus forecasts for full year headline profit before tax range from £110m to £120m, and Electrocomponents said that, assuming no change in market conditions, it expects the actual number will be "slightly below the lower end of consensus."
Group sales growth in the first half of the financial year is expected to be flat on the prior year, with maintenance sales growing slightly and electronics sales declining slightly. Within the period sales trends were similar between the first quarter and the second, with continuing strong comparators and a challenging economic environment.
Analysts at Seymour Pierce responded by downgrading its shares to hold from buy (Target price: 195p). Interestingly, perhaps, they are of the opinion that the company is outperforming both the market and its closest peer, Premier Farnell. Despite this analysts at Espirito Santo were today telling clients to rotate out of Electrocomponents and into Premier Farnell.
The LSE, meanwhile, has been wrong-footed by proposed European regulatory changes which will cut net treasury income over next financial year.
Recommendations published by the European Securities and Markets Authority (ESMA) and the European Banking Authority (EBA) look set to change the rules of the game, and differ considerably from the initial proposals published in March 2012.
"If adopted in their current form, the recommendations will have some implications for LSE's existing wholly owned subsidiary CCP, CC&G," the LSE said.