After a 2018 that saw the stock look less than addictive, the company has mounted a decent rebound in 2019, briefly striking £27 having opened at £24.43. It has pulled back from that February high, however, with Imperial Brands PLC (LON:IMB) now at a current trading price of £25.80.
The firm’s last proper update was November’s full year results. There Imperial revealed revenue had risen 0.9% to £30.5 billion, with a 5.7% increase in operating profit to £2.41 billion and a 10% increase to its dividend to 187.8p per share. That latter jump helped counter a 2.7% drop in basic EPS to 143.6p, a decline that came following the bankruptcy of wholesale distributor Palmer & Harvey.
As for its outlook for FY19, Imperial said that while its tobacco business will ‘continue to deliver modest revenue growth, high margins and strong cash flows’, its next-generation products division is a ‘significant additive opportunity’ on top of its traditional offerings, coming with ‘stronger growth prospects contributing to margins and cash returns over time’. However, those NGPs – like e-cigarettes – do carry the impending risk of extra regulation, especially in the US.
The firm also said in November that it is looking to deliver constant currency revenue growth ‘at, or above, the upper end’ of its 1% to 4% forecasts, but with ‘slightly lower’ adjusted operating profit in the first half due to a £100 million investment in its blu e-cig brand. Any update on these expectations will be much sought after on Wednesday.
Imperial Brands PLC(LON:IMB) has a consensus rating of ‘Hold’ alongside an average target price of £30.33.
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