Unilever full-year results: where next for the share price?
The consumer goods company will unveil its full-year results on Thursday, with analysts from Jefferies warning that the maker of Dove soap is vulnerable to an activist investor due to its low valuation after a sales downgrade.
Analysts from Jefferies said that Unilever could be vulnerable to an activist investor after the the company issued a sales downgrade in December that sent its shares lower.
In a note ahead of the company’s full-year results on Thursday, analysts at the US-based investment bank warned that the stock’s low valuation was an ‘invitation to activism’.
‘The last time Unilever was in this sort of pickle was in January 2017 — we all know what happened next,’ Jefferies said in a note, referencing the hostile bid Kraft Heinz made two years ago.
Ready to start hedging? Open an account with IG today to get started.
Sales downgrade sends Unilever shares lower
Unilever expects underlying sales growth for 2019 to come in slightly below its guidance of the lower half of its 3% - 5% multi-year range.
‘Due to challenges in certain markets, we expect a slight miss to our full year underlying sales growth delivery,’ Unilever CEO Alan Jope said.
‘While we expect improvement in H1 2020 versus this quarter, we expect that first half growth will be below 3%,’ he added.
‘Growth remains our top priority and we are confident we have the right strategy and investment in place to step up our performance.’
Following the downgrade, Unilever saw its shares fall by as much as 9% to £42.40 on 8 January. However, the stock has recovered slightly since then, closing at £44.28 on Monday.
Analysts expects Unilever to deliver sales of €52 million in its 2019 full-year results on Thursday, up from €51 billion last year, with underlying pre-tax profit forecast to come in at €9.9 billion, up from €9.4 billion in 2018.
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
Please see important Research Disclaimer.
Seize a share opportunity today
Go long or short on thousands of international stocks.
- Increase your market exposure with leverage
- Get spreads from just 0.1% on major global shares
- Trade CFDs straight into order books with direct market access
Live prices on most popular markets
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.