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3i rises as Barclays increases price target
Shares in 3i Group PLC (LON:III) are up 2.1% - topping the FTSE 100 risers - after Barclays (LON:BARC) raised its price target by 14% to 2,810p.
The bank reiterated its ‘overweight’ rating ahead of a trading statement on Thursday.
It said Action's Christmas trading and the first insight into Action's 2023 result will be the key focus.
It forecasts a third quarter NAV of 2005p, which reflects strong Christmas trading, but sees a scenario where this could be 50p higher.
Barclays pointed out that twelve months ago, Action reported its first COVID-free Christmas trading period since 2019.
That result surprised “very positively,” and changing investor perceptions around the potential growth of Action, and in turn around 3i's NAV.
Its 3i forecast is based on Action reporting 2023 sales and EBITDA growth of 29% and 35%.
But it said a continuation of the strong October annual growth and margin dynamics could see Action EBITDA over €50 million higher with an associated uplift to 3i NAV.
Eurozone escapes recession despite stagnant growth
The eurozone has avoided falling into recession, despite Germany’s economy contracting and France stagnating in the last quarter.
GDP across the eurozone, and the wider European Union, was flat in the fourth quarter of 2023, data from Eurostat shows.
That follows the 0.1% contraction in the third quarter, and means Europe has narrowly avoided a technical recession (two negative quarters in a row).
The figures were boosted by firmer growth in Italy and Spain.