Shares round-up: records fall for one of these four companies

A 53% Galliford Try dividend hike, dealmaking at British Land, compounding success at Telecom Plus and the recovery of SSP Group today threw up a broad mix of mid-cap investment stories.

The shares of FTSE All-Share construction firm Galliford Try Holdings (LSE:GFRD) fared best out of the quartet, hitting a fresh record as profits for the year to 30 June rose 40% to top City forecasts at £32.7 million.

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It pledged to distribute 11.5p a share on 5 December, up from 7.5p the year before and resulting in a total for the financial year of 15.5p. Confidence in prospects and in future cash generation also saw the group launch a £10 million share buyback programme.

Galliford is able to do so thanks to a well-capitalised debt-free balance sheet and a £3.8 billion order book, with 92% of 2025 revenues already secured.

It is now focused on health, education, defence, custodial, highways and environment projects, having offloaded its Linden Homes and Partnerships operations to Vistry at the start of 2020.

The shares rose 18p to 318p but broker Peel Hunt believes they still offer excellent value on 10.9 times forecast 2026 earnings. It lifted its price target to 380p, while fellow broker Panmure Liberum has an estimate of 415p after the “very strong” 2024 results.

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Peel Hunt added: “We believe the potential to deliver both strong growth, an improving quality of earnings and strong shareholder returns is not reflected in an undemanding valuation, supported by average net cash (160p per share) and investments (42p per share).”

In the FTSE 250 index, British Land Co (LSE:BLND) shares were in the spotlight after it spent £441 million on a portfolio of seven retail parks. The sites in locations including Waterlooville and Rugby are 99% occupied and mostly anchored by Marks & Spencer stores.

Chief executive Simon Carter said: “These assets offer an attractive yield and strong rental growth prospects in line with our guidance of 3-5%.”

UBS noted last night that retail parks now form 32% of the company’s portfolio, up from 22% 18 months ago for about 10% of the UK market. The deal is "immediately earnings accretive" and is part-funded through the placing of 70 million new shares or about 7% of share capital.

The fundraising, which included a retail element via the PrimaryBid platform, generated proceeds of £301 million after the offer was priced at a 3.6% discount of 422p.

The shares trade with a 5.2% dividend yield and have delivered a 13% total return year to date. As we reported yesterday, Deutsche Bank has lifted its price target to 510p after highlighting the shifting risk-returns in the sector as interest rates begin to fall.

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The full-year update by SSP Group (LSE:SSPG) showed a strong recovery in sales, including in the UK as Upper Crust and sites run on behalf of chains including Starbucks benefited from a busy summer for airports and a reduction in strike activity at railway stations.

Group-wide fourth quarter revenues growth of 15% included a like-for-like sales figure of 6%, with the same-store performance for UK & Ireland up 9% and North America 4% higher.

It also saw strong trading in Spain and other Mediterranean holiday destinations, offset by the negative impact of the Paris Olympics and weak trading in German motorway service areas..

SSP expects annual revenues of about £3.5 billion, up 17% with operating profit likely to be between £210-220 million for a rise of about 30% year-on-year.

Currency headwinds meant shares were today close to their opening mark at 157.6p, which compares with Peel Hunt’s 350p target price.

The broker sees profit almost doubling by 2026, driven by 3-5% annual net contract growth, higher passenger volumes as well as price rises and a more efficient operating base.

It added: “With the valuation close to record lows, we view this as an attractive medium-term buying opportunity.”

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Telecom Plus (LSE:TEP) shares rose 31.6p to 1805.6p as the Utility Warehouse business maintained its record of double-digit growth.

The company provides integrated services spanning communications, energy and insurance markets, meaning customers get a single monthly statement. Telecom Plus does not advertise, relying instead on partners who recommend the service to friends and family.

It added 67,000 customers in the first half of its financial year, an annual growth rate within its 12%-14% forecast range as it focuses on a medium-term target to double the overall figure to two million.

Peel Hunt, which has a 2,600p target price, said the shares continue to look good value for a business that it expects to compound at 10% earnings growth per year.

The current multiple of 15 times forecast 2025 earnings compares to the five-year average of 24 times, with the shares yielding 4.8%. It added: “We expect this delta to close as the underlying strengths and consistency of the business are demonstrated in a stable energy market.”