Two FTSE 100 Stocks Under Spotlight: DS Smith PLC and Flutter Entertainment PLC

DS Smith PLC (LON: SMDS)

In Europe, DS Smith Plc is a leading corrugated packaging provider. In addition, it provides plastic packaging services around the globe. The products manufactured by the group are used for various purposes such as transportation of beverages, chemicals and pharmaceuticals. The company also manufactures paper grades, such as a solid board. The company operates in 35 plus countries and has 31,000 plus employees.

SMDS-Recent News

The company announced that Dobra Berba approached Rapak, a part of the company for a bag in box packaging that can extend the shelf life of mulled wine. The packaging would be eco-friendly and would not affect the environment. The company released its half-yearly results for the financial year 2020 on 5^th December 2019.

SMDS–Business performance for H1 FY20 period ended 31st October 2019

(Source: Company’s filings, London Stock Exchange)

The group announced a decent business performance regardless of the unfavourable economic environment. Notwithstanding, the organisation faces a few risks and vulnerabilities, which could affect the nature of the business of the group. Failure in acquisition strategy of the company could impact the overall performance of the company. Weak consumer demand could slow down the growth of the company. Adverse exchange rate positions may also create unpredictable pressures on pricing for key commodities.Â

The group’s revenue surged by 4 per cent on a reported basis (3 per cent growth at constant currency basis) to GBP 3,188 million in the first half of the fiscal year 2020 due to the acquisitions made by the group.

The group’s operating profit (adjusted) surged by 15 per cent on a reported basis (14 per cent growth at constant currency basis) to GBP 351 million in the first half of the fiscal year 2020 due to the ownership of Europac, and the net impact of volume growth related to corrugated box.

The group’s adjusted EPS surged by 5 per cent on a reported basis (4 per cent growth at constant currency basis) to 17.4 pence in the first half of the fiscal year 2020. The group has declared an interim dividend of 5.4 pence per share in the first half of the fiscal year 2020.

The operations of the company are impacted by the uncertainty of Brexit. The group operates in a competitive and disruptive market, which could affect the margins earned in the business of the group. Any change in consumer behaviour or in the shopping habits of the customers could impact the profitability of the group. Inability to meet with the packaging transformations could affect the revenue and profitability of the group.

The group delivered record profitability and return on sales during the first half of the financial year 2020. The group has gained market share with the help of multinational FMCG and e-commerce customers.

The group has shown good organic profit growth. The group has a strong balance sheet and cash flows. The group anticipates an acceleration of volume growth in the second half of the year. The group has paid dividends to its investors on a continuous basis which signifies its importance for its investors. The group has a positive outlook towards its business growth and a high potential for a bright future.

SMDS-Stock price performance

(Source: Thomson Reuters) Daily Chart as on Dec-30-19, before the LSE market close

The market capitalisation of the company while writing as on 30th December 2019 (at 09:03 AM GMT) was approximately £5.36 billion and a dividend yield of 4.17 per cent.

While writing, DS Smith PLC’s shares were trading at GBX 390.50 per share; which were 0.71 per cent down in comparison to the previous day closing price level.

The shares of the DS Smith PLC have struck a high of GBX 397.80 (as on December 13, 2019) and a low of GBX 291.20 (as on January 04, 2019) in the last twelve months. At the current price point, as quoted in the price chart, the company’s shares were trading 1.84 per cent below the high price point attained in the last twelve months and 34.10 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 2,241,655.60; 30 days- 4,001,552.10 and 90 days – 4,286,009.53. The 5 days daily average traded volume of the shares of the company was down by 43.98 per cent in comparison to 30 days daily average traded volume. The shares of the company were trading above the 60-days and 200-days SMA while writing.

On a YTD (Year-to-Date) time interval, the shares of DS Smith PLC surged by approximately 31.41 per cent and were up by 11.07 per cent in the last quarter. However, DS Smith PLC’s shares have delivered 2.21 per cent positive return in the last one-month period.

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Flutter Entertainment PLC (LON: FLTR)

Dublin-based group, Flutter Entertainment PLC provides sports betting, gaming and entertainment around the world. The group’s online transactions of 3 billion, i.e. equivalent of 6000 per minute, have 6 million active clients in more than 100 nations, and 8,000 representatives across 16 offices and more than 620 retail shops. The group is differentiated in different business segments: online, Australia, US, and retail.

FLTR–Business performance for FY19 3Q period ended 30^th September 2019

(Source: Company’s filings, London Stock Exchange)

On a divisional basis, the online division revenue stood at £247 million, a decrease of 1 per cent as compared with the corresponding period of the last year, driven by a decrease in sports segment in online division. In US division, the revenue rose by 67 per cent to £91 million in the third quarter of the fiscal year 2019, due to the excellent sportsbook and gaming performance. Retail revenue decreased by 9 per cent year‐on‐year to £75 million in the third quarter of 2019. In Australia division, the Sportsbet revenues surged by 19 per cent to £119 million in the current quarter, driven by a strong net revenue margin of 11.4 per cent and good customer growth over the last 12 months.

The group reported growth of more than 10 per cent in revenue of sports and gaming segments. The Sports segment revenue stood at £417 million for the third quarter of 2019, was up by 11 per cent in comparison to £375 million in the third quarter of 2018. Gaming revenue increased by 8 per cent to £116 million for the reported period in contrast to £107 million reported in the same period last year. The group’s revenue surged by 10 per cent to £533 million in contrast to the corresponding period of the last year from both the segments.

FLTR-Stock price performance

(Source: Thomson Reuters) Daily Chart as on Dec-30-19, before the LSE market close

The market capitalisation of the company while writing as on 30th December 2019 (at 09:18 AM GMT) was approximately £7.22 billion and a dividend yield of 2.23 per cent.

While writing, Flutter Entertainment PLC’s shares were trading at GBX 9,240.00 per share; which were up 0.11 per cent in comparison to the previous day’s closing price level.

The shares of the Flutter Entertainment PLC have struck a high of GBX 9,278.00 (as on December 27, 2019) and a low of GBX 5,390.00 (as on March 08, 2019) in the last twelve months. At the current price point, as quoted in the price chart, the company’s shares were trading 0.41 per cent below the high price point attained in the last twelve months and 71.43 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 249,800.20; 30 days- 293,998.43 and 90 days – 354,791.03. The 5 days daily average traded volume of the shares of the company was down by 15.03 per cent in comparison to 30 days daily average traded volume. The shares of the company were trading above the 60-days and 200-days SMA while writing.

On a YTD (Year-to-Date) time interval, the shares of Flutter Entertainment PLC surged by approximately 44.22 per cent and were up by 21.13 per cent in the last quarter. However, Flutter Entertainment PLC’s shares have delivered 4.29 per cent positive return in the last one-month period.