Calling all activist investors — Jefferies thinks you should get your claws into TSB.
The broker downgraded TSB, spun-out of Lloyds last year, complaining that an estimated £1.6 billion of value is trapped in the business.
TSB’s promise to be a friendlier, more old-fashioned bank has left it with a branch network that Jefferies believes is far too large, with scope to axe as many as 399 branches.
The bank could also benefit from moving its IT systems away from a Lloyds platform, and Jefferies thinks TSB should also be snapping up loan portfolios.
All of this means TSB is, in effect, “rolling out the welcome mat for an activist investor”, Jefferies says, unless management begin tackling the issues.
TSB dipped 4.1p to 262.5p.
With Chinese New Year tomorrow, it appeared traders were in celebratory mood.
The FTSE 100 looks closer than ever to breaking through the all-time high of 6950.6 recorded on the eve of the millennium, up 4.28 at 6902.41.
Engineer Weir Group benefited from an endorsement from UBS, which said the risks from the downturn in US shale to its oil and gas business are now reflected in the share price.
Weir, which has full-year results next week, rose 34p to 1891.5p.
After strong numbers yesterday, shopping centre-owner Hammerson was the victim of profit taking, falling 11.5p to 672p. A downgrade from Oriel Securities didn’t help.
WH Smith fell 17p to 1287.5p as Barclays told investors to take some money off the table.
The snacks and newspaper-seller has long been a favourite among investors thanks to its trick of growing profits despite falling sales.
But Barclays warned that the newsagent’s “forensic attention” to detail is now taken for granted, with shares trading near all-time highs.
The Malaysian majority owner of casino operator Rank Group cashed in some of its winnings today.
Peel Hunt made a tidy £92.5 million for the Hong Leong Company, offloading 50 million shares in the Grosvenor Casino owner at 185p apiece. Hong Leong still holds 56.1% of Rank, up 0.4p at 186.75p.
Petropavlovsk jumped yesterday after a major investor blasted the Russian gold-miner’s debt-restructuring plans and called for a new deal which was more favourable to shareholders.
But today, Petropavlovsk once again urged investors to back its plan, warning there is a “very high risk” the company could go under if it is rejected. The business dipped 0.25p to 16.5p.
Production software provider Zoo Digital jumped 1.12p to 9.5p on AIM as it announced a deal to provide subtitling and captioning to BBC Worldwide, which distributes shows such as Sherlock starring Benedict Cumberbatch globally.
It came despite a warning that second-half revenues are set to be lower than the first six months of the year because of seasonality and “disruption within a major customer”.
