FTSE 250 movers: Hikma looks over hiccup, Cussons warns again

London's FTSE 250 index was little moved on Thursday, with a rallying Hikma Pharmaceuticals and Cineworld leading the risers as PZ Cussons and Spirax fell.

Hikma has gained another 16% on top of gains on the back of the generic drug-maker's results the day before. Investors are being encouraged in their bargain hunting by upgrades to 'buy' at Citi and to 'hold' at Jefferies.

"While the outlook for the US Generics industry and Hikma in particular remains challenging, we argue this is fully reflected in the share price," said Citi. "Sensible assumptions" of the group's branded, injectables and generics divisions drive a £12.50 net present valuation, with "scenario analysis" showing a skewed bull-bear valuation of £20-7 and the arrival of a new CEO "points to guidance being set conservatively".

Cineworld, which had pretty much pre-announced most of its numbers when it closed the acquisition of US chain Regal Entertainment to become the second largest cinema chain in the world, did not raise the curtain on any big surprises with its full year results but management said they are “encouraged” by the opening weeks of the year. The film slate this year looks strong, with Marvel's Black Panther already breaking records, with new spin-offs for Jurassic World, Mary Poppins, Star Wars and 50 Shades but Jamie Constable at broker N+1Singer said 2018 is down on 2017 with the next "big blockbuster year" being 2019. He views the Regal deal as being very much a 'defensive' one in the face of Netflix et al, and Sky Movies and Disney's intentions in this market.

TalkTalk was up despite rival BT announcing the largest recruitment drive in the history of its Openreach 'arm's length' infrastructure division in order to help expand ‘full-fibre’ around the UK. Shares in fibre specialist CityFibre were down 2%, though TalkTalk rose on the back of an upgrade from Macquarie.

Soaps and show gel maker PZ Cussons saw another 15% of its market value leak down the plughole after issuing a profit warning as trading conditions had not improved. The company had reported in January that performance in the first half of the year was constrained by conditions in the UK and Nigeria, and that delivery of the full year result would be dependent on conditions in those markets for the balance of year. Today it said it was now apparent that profit for the full year would fall short of expectations.

Spirax-Sarco Engineering was down despite good full year numbers, with reported revenue up 32% and 6% organic, with earnings per share up 29% and dividend hiked 15%. Guidance for 2018 was not as strong as some investors might have liked to see, with management confident in its ability to deliver above market growth rates but expecting a slight softening in market conditions, with industrial production staying positive but at lower levels than seen in 2017. Brexit negotiations and uncertainty are likely to remain a key factor affecting market conditions in the region, while political elections in Italy and ongoing political uncertainties in Germany could cause some turbulence.

With this slight double the shares were likely to have been hit by a bit of profit taking, valued at 15.5 times this coming year's earnings, though the company "oozes quality" says Singer's Constable.

OneSavings Bank was in the red despite posting a 21% jump in full-year profit as the loan book grew and saying it kicked off 2018 with a strong pipeline of new business, as guidance on margins disappointed.

Construction and services group Kier fell after reporting a small rise in first-half profit and sounding an upbeat note on the outlook for 2018. Pre-tax profit was up 4% to £48.8m on revenue of £2.2bn, up 8%, with chief executive Haydn Mursell saying the group remained on course to deliver double-digit profit growth in 2018.

Mursell said: "The group is performing well. Our £9.5bn construction and services order book, combined with our £3.5bn pipeline in the property and residential divisions, provides good visibility of work over the medium term."

Market Movers

FTSE 100 (UKX) 7,129.76 -0.04%
FTSE 250 (MCX) 19,818.40 -0.01%
techMARK (TASX) 3,334.78 0.20%

FTSE 100 - Risers

Tesco (TSCO) 216.35p 2.88%
London Stock Exchange Group (LSE) 4,027.00p 1.54%
Experian (EXPN) 1,608.00p 1.52%
Shire Plc (SHP) 3,192.50p 1.51%
Prudential (PRU) 1,942.50p 1.28%
Halma (HLMA) 1,201.00p 1.18%
Legal & General Group (LGEN) 260.90p 1.05%
Smiths Group (SMIN) 1,586.00p 1.02%
NMC Health (NMC) 3,386.00p 1.01%
St James's Place (STJ) 1,133.00p 0.98%

FTSE 100 - Fallers

Hammerson (HMSO) 433.30p -5.10%
GKN (GKN) 426.80p -2.49%
Anglo American (AAL) 1,754.40p -1.96%
Just Eat (JE.) 748.60p -1.91%
Unilever (ULVR) 3,747.50p -1.91%
Micro Focus International (MCRO) 1,939.00p -1.75%
Fresnillo (FRES) 1,197.50p -1.52%
Evraz (EVR) 435.70p -1.45%
Imperial Brands (IMB) 2,485.50p -1.43%
Land Securities Group (LAND) 905.30p -1.31%

FTSE 250 - Risers

Hikma Pharmaceuticals (HIK) 1,082.00p 16.47%
TalkTalk Telecom Group (TALK) 112.70p 6.72%
Spirax-Sarco Engineering (SPX) 6,066.55p 5.60%
Computacenter (CCC) 1,124.00p 5.44%
Cineworld Group (CINE) 248.00p 3.25%
Greencore Group (GNC) 130.20p 2.44%
John Laing Group (JLG) 252.20p 2.11%
Jardine Lloyd Thompson Group (JLT) 1,314.00p 2.02%
Renewi (RWI) 87.50p 1.74%
Weir Group (WEIR) 1,965.00p 1.66%

FTSE 250 - Fallers

PZ Cussons (PZC) 235.40p -14.96%
Hochschild Mining (HOC) 194.60p -5.44%
Dignity (DTY) 931.00p -5.19%
OneSavings Bank (OSB) 385.00p -5.17%
Essentra (ESNT) 455.80p -4.84%
Crest Nicholson Holdings (CRST) 472.20p -4.41%
Coats Group (COA) 78.20p -3.81%
Big Yellow Group (BYG) 867.50p -3.56%
Kier Group (KIE) 1,043.00p -3.25%
Royal Mail (RMG) 530.80p -3.17%