Shares in Mitie Group (MTO) aren’t looking so mighty this morning, chalking up losses of up to 17% to make them the worst performer on the , eclipsed only by blue-chip Pearson (PSON) down a whopping 26%. Both companies are wearing yet another ugly profits warning (both on their third since September) that merely adds insult to injury for loyal holders. However, their shares prices are now taking rather divergent paths.

Mitie blames an expected halving in 2017 profits on property management clients deferring decisions (Brexit?), investment delays in the technical FM unit, underperformance in its cleaning division and additional one-off charges. Staying within banking covenants is one bright spot although the Finance director is offski in Feb. Having rallied 13% from their lows we’re seeing a repeat of the Nov bounce and today’s plunge didn’t go as far as that in November.

Pearson attributes withdrawal of 2018 profits guidance, a revision of 2017’s to below consensus and a rebasing of its dividend (a 6% yield was genuinely attractive a this low returns environment) on a worsening in US trading conditions for higher education courses. With outlook always king, 2016 operating profits expected in-line with expectations means little. Selling its 47% stake in the Penguin Random House JV to bolster finances and reinvest in digital publishing adds to recent disposal of print (FT + stake in the Economist) to focus on education, but with today’s revision dealing another hit to the books, this narrowing of activities is proving a tough lesson for both management and frustrated investors, the shares trading their worst levels since July 2009.

Mike van Dulken, Head of Research, 18 Jan