Three things you need to know in the financial markets this morning from investment writer, Tony Cross.
Lookers
Audited financial statements from auto retailers Lookers LON:LOOK have been published this morning, critically paving the way for their shares to be relisted following a suspension back in the summer. These numbers cover the period to December 31st 2019 and were held back following an investigation into the company’s financial systems and accounting controls. Obviously COVID has proved disruptive for the current year so any hopes of a quick rebound back may need to be side-lined, but management notes that following lockdown, sales in Q3 were better than expected. Dealerships are however closed once again with the latest lockdown – any hopes that the accounting problems could be quickly forgotten may need to be sidelined.
AA
Following comments at the start of the week, the AA [LON:AA] has now proposed shareholders accept the 35p cash offer which has been tabled by a private equity bidder. That may be a tidy premium over where shares had been trading earlier in the year, but longer term investors may feel aggrieved that this doesn’t reflect good value.
G4S
A bullish statement from G4S [LON:GFS] in another bid to see off an unsolicited takeover from Garda World. The company has committed to resuming dividend payments in the new year, adding that there’s potential for further significant cash returns to shareholders, too. This is the latest salvo in an attempt to highlight that the suggested acquisition price is too low and fails to reflect the fundamental value of the business. The challenge here of course is management now need to deliver against the defence they are outlining, with a 7% profit margin target and revenue growth of 4%-6% now both very clear lines in the sand.
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