Johnson Matthey is trading at 3261, down 2.5% on the day after investment house Liberum Capital stated the company’s results were unlikely to result in any broker upgrades. Liberum foresees a good second-half performance but is sceptical about the outlook for the next two years.
In November, Johnson Matthey revealed a first-half profit of £213 million, a 13% increase from the period before; the results also exceeded analyst estimates.
The company is the world’s largest supplier of catalytic converters. A rise in European car sales and tougher regulations for trucks in the EU has helped boost its profits. This trend is likely to continue as European car sales rose by 4.6% in April.
Johnson Matthey’s contract with Anglo American expired in December, and the loss of business is likely to impact its final-year figures.
The stock has found support at the 200-day moving average of 3125. If the results are well received on Thursday the stock could target 3360.