MNZS, FGP, TEK: Stocks you may consider as economic outlook worsens

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MNZS, FGP, TEK: Stocks you may consider as economic outlook worsens

 MNZS, FGP, TEK: Stocks you may consider as economic outlook worsens
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Highlights

  • UK companies are hardly anticipating any growth over the next three months, a recent survey has stated.
  • As per CBI’s survey results, the expectations of retailers, manufacturers, and other service-related businesses have declined to +1%.
  • In the next three months, a drop in sales is anticipated by most consumer services businesses, which can be alarming.

Amid the worsening cost-of-living crisis, UK companies are in their gloomiest outlook since February 2021. According to a report published by the Confederation of British Industry (CBI) on Wednesday, UK companies are hardly anticipating any growth over the next three months as the escalating inflationary crisis is leading to a squeeze in the budgets of households. The disposable income of households has been declining as consumer confidence is falling and business activity is contracting.

As per CBI’s survey results, the expectations of retailers, manufacturers, and other service-related businesses have declined to +1%. This means that there is a divergence of 1 percentage point among the proportion of businesses anticipating growth instead of contraction.

It is a matter of concern that the expectations for activity in the private sector have deteriorated, but this was foreseeable with the strengthening of the inflationary headwinds.

In the next three months, a drop in sales is anticipated by most consumer services businesses.  Business services companies and retailers expect that their output would be stagnant, while manufacturers are expecting growth in output. As per BoE’s estimates, UK inflation levels are all set to hit double-digit growth, and while the business activity is falling, recession alarms are ringing in the UK.

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Amid this deteriorating economic outlook, investors may keep an eye on these FTSE industrial stocks offering decent annual returns.

UK private sector sees sluggish growth

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John Menzies plc (LON: MNZS)

The shares of the leading provider of airport services, John Menzies plc, were up by 0.33% as the market opened at around 8:00 AM (GMT+1) on 1 June 2022, at GBX 600.00. The company has provided its shareholders with a return of 92.00% over the last one year as of 1 June 2022. The current market cap of the company stands at £549.82 million.

FirstGroup plc (LON: FGP)

The shares of the UK’s leading transport operator, FirstGroup plc, were up by 0.88% as the market opened at around 8:00 AM (GMT+1) on 1 June 2022, at GBX 137.70. The FTSE250-listed company has provided its shareholders with a return of 67.97% over the last one year as of 1 June 2022. The current market cap of the company stands at £1,023.94 million.

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TekCapital plc (LON: TEK)

The shares of the IP investment and tech transfer business, TekCapital plc, were trading at GBX 26.50 as the market opened at 8:00 AM (GMT+1) on 1 June 2022. The company has offered its shareholders a return of 66.38% over the last one year as of 1 June 2022. The current market cap of the company stands at £39.64 million.

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