Recent Updates On Two FTSE 350 Media Stocks: Pearson Plc And Future Plc

December 20, 2019 12:56 PM GMT | By Team Kalkine Media
 Recent Updates On Two FTSE 350 Media Stocks: Pearson Plc And Future Plc
Pearson Plc (LON:PSON)

Pearson Plc is a British-based learning company. The group serves private and public institutions, governments, and individual learners in numerous countries to provide them with education products and services like test development, processing, and scoring services and a wide range of other educational services.

PSON-Directorate changes and Trading Update for FY19 9M

The company reported that John Fallon has indicated his intention to retire as Chief Executive, he shall be serving till 2020 and the company is looking forward to finding his replacement.

The company stays on track to provide in excess of 330 million pounds of annualised cost savings, with the full advantage accumulating from the end of the year 2019 onwards. The financial position stays strong, and the company continue to anticipate year-end net debt to be broadly in line with previous year.

The company looks forward to stabilising its revenue. The company’s US Higher Education Courseware business is expected to perform sluggishly as against the expectations. The adjusted operating profit is expected to be in the bracket of £590 to £640 million.

PSON-Business performance for H1 FY19 period ended 30th June 2019

The company recorded growth in all its three segments, with total revenue (on an underlying basis) grew by 2 per cent in the first half of the financial year 2019. The company’s operating profit (reported) plunged from £233 million in H1 FY2018 to £37 million in H1 FY2019 due to disposal of businesses and restructuring charges incurred.

However, the turnover (on a headline basis) plunged by 2 per cent to £1,829 million in H1 FY2019 from £1,865 million in H1 FY2018. The company’s Adjusted operating profit (on an underlying basis) grew by 30 per cent from £107 million in H1 FY2018 to £144 million in H1 FY2019. The board of the company approved an interim dividend of 6 pence per share during the period.

PSON-Stock price performance

(Source: Thomson Reuters) Daily Chart as on Dec-20-19, before the LSE market close

While writing (as on 20th December 2019, at 09:02 AM GMT), Pearson Plc’s shares were trading at GBX 625.40 per share; which were 1.69 per cent up in comparison to the previous day closing price level. Total market capitalisation of the group at the time of writing was hovering around £4.84 billion.

The shares of the Pearson Plc have struck a high of GBX 1,030.00 (as on January 11, 2019) and a low of GBX 610.35 (as on December 19, 2019) in the last twelve months. At the current price point, as quoted in the price chart, the company’s shares were trading 39.28 per cent below the high price point attained in the last twelve months and 2.47 per cent above the low price point attained in the last twelve months.

At the time of writing, the stock's average daily traded volume for 5 days was 3,795,119.80; 30 days- 2,672,198.87 and 90 days – 2,710,901.67. The company’s stock beta (5Y monthly) stood at 0.34, which implies that the company’s stock is less volatile in comparison to the benchmark index along with a dividend yield of 3.09 per cent.

The shares of the company were trading below the 30-days and 60-days SMA while writing. The stock’s daily average traded volume for 5 days surged by 42.02 per cent in contrast to 30 days daily average traded volume.

On a YTD (Year-to-Date) time interval, the shares of Pearson Plc plunged by approximately 34.46 per cent and were down by 28.72 per cent in the last quarter. However, Coca Cola HBC AG’s shares have delivered 7.82 per cent negative return in the last one-month period.

RSI (Relative Strength Index) of the Pearson Plc’s shares for the 30-days, 14-days and 9-days were hovering in the mid-range, were recorded at 35.31, 34.19 and 32.54 respectively. In addition, the RSI for 3-days of the company’s stock stood at 19.80.

Future PLC (LON:FUTR)

The UK based media and publication organisation, Future Plc is a company with international presence. The company manages its operations through divisions: media, magazine and others. The media division consists of websites and events. Magazine and others division include publishing. The company engages in publishing magazines, applications and websites. The company also operates in technology, games and entertainment segment. The company has a subscriber base of more than 260 million and has around 1200 representatives across the globe.

FUTR-Recent News

The company announced its annual report and financial statements for the year ended on 30th September 2019 on 13th December 2019. FUTR-Business performance for FY19 period ended 30th September 2019

(Source: Annual report, Company’s website)

The group's adjusted revenue grew by 70 per cent on a Year on Year basis to GBP 221.5 million in the financial year 2019 in contrast to GBP 130.1 million in the financial year 2018, as a result of group’s successful execution of core organic growth strategies and focused acquisitions.

In addition, the group’s expansion in the United States fared well, and the contribution of the revenue from the United States accounted for 54 per cent of the group’s total revenue.

For the financial year 2019, the company’s reported operating profit during surged by 404 per cent to GBP 26.7 million in contrast to GBP 5.3 million in the financial year 2018, and reported operating margin surged to 12 per cent from 4 per cent reported earlier in the financial year 2018, as a result of increased business scale the group was benefited by reaping higher margins from its media businesses. The group delivered sound financial performance in the fiscal year 2019.

The group has generated diversified revenue streams and has leveraged its technology platform to reap profits. The group’s Reported earnings per share (diluted) was up by 98 per cent to 9.3 pence per share in contrast to 4.7 pence per share in the same period last year. The group has performed well ahead of the market’s expectations.

However, there are some potent risks which can impact the business of the group, due to a challenging environment and some uncertainties. The profitability of the group can be impacted by any changes made to the advertising models used. The operations of the company can be dented by a critical data breach or a failure in cybersecurity. Furthermore, from the macro standpoint, the business could be impacted by economic downturn on the backdrop of Brexit uncertainty.

FUTR-Stock price performance

(Source: Thomson Reuters) Daily Chart as on Dec-20-19, before the LSE market close

While writing (as on 20th December 2019, at 09:09 AM GMT), Future Plc’s shares were trading at GBX 1,430.00 per share; which were 1.56 per cent up in comparison to the previous day closing price level. Total market capitalisation of the group at the time of writing was hovering around £1.39 billion.

The shares of the Future Plc have struck a high of GBX 1,572.00 (as on November 26, 2019) and a low of GBX 460.00 (as on January 07, 2019) in the last twelve months. At the current price point, as quoted in the price chart, the company’s shares were trading 9.03 per cent below the high price point attained in the last twelve months and 210.87 per cent above the low price point attained in the last twelve months.

At the time of writing, the stock's average daily traded volume for 5 days was 458,800.80; 30 days- 657,988.20 and 90 days – 461,626.01. The company’s stock beta (5Y monthly) stood at 0.83, which implies that the company’s stock is less volatile in comparison to the benchmark index. The dividend yield was of 0.07 per cent.

The shares of the company were trading above the 60-days and 200-days SMA while writing. The stock’s daily average traded volume for 5 days dipped by 30.27 per cent in contrast to 30 days daily average traded volume.

On a YTD (Year-to-Date) time interval, the shares of Future Plc surged by approximately 194.56 per cent and were up by 10.34 per cent in the last quarter. However, Coca Cola HBC AG’s shares have delivered 2.49 per cent negative return in the last one-month period.

RSI (Relative Strength Index) of the Future Plc’s shares for the 30-days, 14-days and 9-days were hovering in the mid-range, were recorded at 52.83, 52.24 and 53.16 respectively. In addition, the RSI for 3-days of the company’s stock stood at 60.79.


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