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FTSE falls on oil price weakness but CRH climbs following update

Discussion in 'Market News' started by Lily, Aug 25, 2016.

  1. Lily

    Lily Forum Member

    Aug 29, 2015
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    Building materials group heads risers after strong performance in US

    Leading shares are losing ground following recent falls in the oil price, but building materials group CRH is bucking the trend.

    Its shares have climbed 2.5% to £25.33, the biggest riser in the FTSE 100, after it reported better than expected half year earnings of €1.12bn, double the figure this time last year and better than the company’s forecast of €1.1bn made last month.

    With continued positive momentum in the Americas and the modest impact of early-stage economic recovery in Europe, and assuming normal weather conditions for the remainder of the season, we expect further progress in the second half with full year reported EBITDA in excess of €3bn.

    The group has delivered a strong set of results, as expected, with the first half benefiting from acquisitions, a particularly strong US and modestly better markets in Europe...These results are consistent with our investment thesis that the group would enjoy good underlying trading, benefit from the recent acquisitions and start to de-leverage relatively quickly. Shares have enjoyed a strong bounce recently and now trade on a fuller rating at around 9 times EBITDA for 2017, but we believe this is supported by today’s good results.

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