This report is not a personal recommendation and does not take into account your personal circumstances or appetite for risk.
Shares in broadband satellite operator Inmarsat (ISAT) are the UK Index losers this morning, taking another painful leg down as shareholders jettison their holdings. It would appear that yesterday’s scrapping of revenue guidance that had only recently been given (early March FY results) is continuing to send a bad signal to investors.
Capitulation is never a good sign, suggesting trading conditions in key segments deteriorating at light speed, faster than even an optimistic management can put a positive spin on. Delays in ramping up its new Global Xpress broadband operation and more fierce competition from the big six satellite peers are also taking their toll.
Having breached the 885p level yesterday, bargain hunters have already stepped in at round number 800p. However, weakness could yet send the shares back to the 775p level that served as a ceiling for much of 2014. After a painful re-entry and breach of 12-month support, will atmospheric drag pull the shares all the way back to earth like space junk? Or can the bullish boosters be fired up again to re-insert them into orbit?
Mike van Dulken, Head of Research, 6 May
This research is produced by Accendo Markets Limited. Research produced and disseminated by Accendo Markets is classified as non-independent research, and is therefore a marketing communication. This investment research has not been prepared in accordance with legal requirements designed to promote its independence and it is not subject to the prohibition on dealing ahead of the dissemination of investment research. This research does not constitute a personal recommendation or offer to enter into a transaction or an investment, and is produced and distributed for information purposes only.
Accendo Markets considers opinions and information contained within the research to be valid when published, and gives no warranty as to the investments referred to in this material. The income from the investments referred to may go down as well as up, and investors may realise losses on investments. The past performance of a particular investment is not necessarily a guide to its future performance. Prepared by Michael van Dulken, Head of Research
Comments are closed.