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So far this year investors haven’t had any hesitation in buying Tate & Lyle shares.

Opening at £6.59, the stock has been pretty consistent in its gains, before picking up the pace in the last month or so. Tate & Lyle shares PLC now sits at a current trading price, and 2 and a half-year peak, of £7.94.

The company kept things pretty vague in February’s third quarter update. Group adjusted pre-tax profit in constant currency for the 3 months to 31st December may have been ‘ahead of the comparative period’, but no hint was given as to by how much.

Its Food & Beverage Solutions division saw higher adjusted operating profit, with ‘volume growth in line with the first half’, where they rose 4%. Sucralose volumes were higher thanks to a programme to optimise production at its Alabama facility, helping adjusted operating profit sneak ‘slightly ahead’ of last year. The Primary Products arm was the sole part of the business to see adjusted operating profit go in the wrong direction, as weaker demand in North American sweeteners led to lower volumes.

The main takeaway from the details-light Q3 statement was that Tate & Lyle is expecting earnings per share in constant currency growth to be in a mid-single digit range, though ‘towards the lower end’ due to energy and transportation cost inflation and a year of strong commodities performance.

Analysts, meanwhile, are expecting the company to post a slight improvement in adjusted pre-tax profit on Thursday, from £301 million to £303 million year-on-year, with adjusted diluted earnings per share at 51.1p, roughly a 2% increase on 2018. Investors will also want to hear of any acquisitions given that CEO Nick Hampton was talking up the prospect of such at the end of April.

Tate & Lyle shares have a consensus rating of ‘Hold’ alongside an average target price of £7.26.

This article is brought to you in association with Spreadex. All opinions expressed in this article are from the author and do not necessarily represent the opinions of The Armchair Trader. You can find out more about Spreadex products and services here, or find more articles from Connor Campbell here.

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Connor Campbell

Connor Campbell

Connor joined Spreadex in 2014 as part of a newly expanded financial analyst team after graduating from the University of Southampton with an MA in English. His focus is on providing Spreadex's customers with up-to-date and informative news, and is responsible for the market analysis found on the Spreadex website.

Connor produces three daily market updates, a daily stock earnings preview, a weekly financial market preview piece every Friday, a round-up of all the big financial stories making the weekend press every Monday morning and regular stock market features.

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