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ITV shares have been all over the place in 2018. Opening at £1.65, they plunged to £1.42 by the start of April – nearing a 5 year low – only to rally to a 13 month peak of £1.83 by early July.

Since then its performance has been a bit more consistent; sadly for the stock, that’s consistently bad, with ITV shares tumbling to £1.43 by the end of October. ITV PLC now sits at a current trading price of £1.53.

There was actually a lot to recommend in July’s half year update

A 16% increase in revenue at ITV Studios and a 2% jump in advertising revenues (with a 48% surge online) helped lead to an 8% leap in the total figure to £1.593 billion, with pre-tax profits up 2% to £265 million.

This as Love Island and the World Cup – including HUGE numbers for England’s semi-final against Croatia – caused a 9% lift to ITV Family’s share of viewing during the period.

The company went on to state that it intends to invest £60 million over the next 3 years, in part offset by cost savings of £35-40 million, with that money largely earmarked for the expansion of its production of programmes and the further development of its ITV Hub streaming service.

Basically, anything to further shift the burden away from the difficult advertising market.

It’s going to be interesting to see what kind of performance ITV shares manage in something of a more normal quarter, one that doesn’t have the propulsion of a World Cup/Love Island double whammy.

The company itself has said it expects total advertising revenue to rise 1% for the 8 months to the end of September, with Q3 ‘broadly flat against a backdrop of continued economic uncertainty’.

ITV PLC has a consensus rating of ‘Hold’ alongside an average target price of £1.89.

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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