We have seen a few companies down grading expectations recently with Pearson and Home Retail being a couple of notable examples earlier this week. Today, following on from my Monday detour down memory lane which featured UK vice stocks, we have had a Q3 trading update from the bookies William Hill (WMH).
This was a bit down beat as they suffered from strong comparatives in the previous year which included the football (soccer) world cup and a poorer gross win reflecting adverse sporting results for bookies this quarter. They also had the effects of the increased rates of UK gambling duty to contend with too. On the back of this they are suggesting that their full year operating profits will now be towards the bottom of a £291 to £312m range which suggests downgrades on average of around 3.5% to me. So the fall in the share price of nearly 6% this morning to 325p would seem to more than factor that in.
Looking at a two year chart this has taken the shares to the bottom of their range and I note a more recent gap on the chart around the 400p which often gets closed eventually and therefore could provide a medium term target if and the shares should recover at some point in the future. In the meantime the rating seems OK and they should start to be supported somewhat by the near 4% yield, but as ever you pay your money and take your choice or place your bets in this case?
Finally, if you were hoping to see Back to the future Part 3 here today - apologies it has been delayed in post production, but I hope to maybe get it out over the weekend or early next week so don't forget to check back here.