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Highlights
- Kingfisher’s strong Q2 2022 trading update drove the company to raise its H1 2022 sales and pre-tax profit guidance.
- Experian’s FY 2022 revenue growth is forecasted to be in the range of 13 to 15 per cent.
Several investors base their investment portfolio’s performance on key market indices such as the FTSE 100. Stocks that belong to these indexes thus receive greater attention and visibility.
Two such stocks, which are a part of the FTSE 100 index, Kingfisher PLC (LON: KGF) and Experian PLC (LON: EXPN) were making noise ahead of their earnings, and early indications are that they may perform ahead of their early expectations.
Let us analyse the investment prospect of these 2 FTSE 100 stocks and :
- Kingfisher PLC (LON: KGF)
Kingfisher is a popular home improvement products and services retail company. It is slated to report the H1 2022 results on 21 September.
In its Q2 2022 trading update, the group’s reported that its like for like (LFL) sales as of 10 July were down marginally by 1.3 per cent. At the same time, its Q2 2022 LFL sales compared to 2 years ago were up 22.3 per cent.
The strong performance was due to high demand from new and existing customers, in retail as well as trade.
It also increased its H1 2022 sales guidance to about 22 per cent. Its H1 2022 pre-tax profit guidance was also raised in a range of £645 million and £660 million, compared to earlier guidance of £580 million to £600 million.
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Kingfisher’s shares were trading at GBX 358.20, up by 1.13 per cent on Monday at 12:35 PM GMT+1. The FTSE 100 index was trading at 7,083.99, up by 0.78 per cent.
The company’s market cap is at £7,478.97 million, and its year-to-date return is at 32.47 per cent as of 13 September 2021.
It has a next twelve months (NTM) price to earnings (P/E) ratio of 11.65, while the industry P/E ratio median is at 14.32x. Also, its NTM dividend yield is 3.29 per cent, while the industry median is 2.60 per cent.
- Experian PLC (LON: EXPN)
Experian is an Ireland domiciled IT support services company. It is expected to report its first half results on 17 November 2021.
Its total global revenues increased by 31 per cent in its Q1 period ended on 30 June, compared to Q1 2021.
The growth was due to its successful deployment of innovative strategy and also due to faster than expected recovery from the pandemic’s impact.
FY 2022 revenue growth is forecasted to be in the range of 13 and 15 per cent, of which organic revenue growth, as per company’s expectation, would account for about 9 to 11 per cent.
(Image Source: EODHD/Others)
Experian’s shares were trading at GBX 3,350.00, up by 0.45 per cent on Monday at 12:59 PM GMT+1. The industrial sectoral index was trading at 7,272.49, up by 0.07 per cent.
The company’s market cap is at £ 30,759.83 million, and its year-to-date return is at 20.62 per cent as of 13 September 2021.
It has an NTM P/E ratio of 35.85, while the industry P/E ratios median is a multiple of 17.67. Also, its NTM dividend yield is 1.25 per cent, while the industry median is 2.17 per cent.
Bottom Line
Blue chip investors looking to hold these two stocks can continue their investment position as both the companies have forecasted improved results.
Dividend investors can opt for Kingfisher as its dividend yield is outperforming the broader sector, while investors keen to invest in the IT sector can consider holding Experian as IT has boomed during the pandemic due to businesses pivoting towards a digital approach.
Furthermore, as the UK economy continues to shed off pandemic related uncertainties and the macro environment improves, stocks would continue outperforming the broader market.
