Analyst delivers blow to Royal Mail investors

[TrueBlueTerrier]

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Recent FTSE 100 entrant Royal Mail suffered share losses after a City broker hit the firm with a sell rating amid concerns over its stock market valuation.

Cantor Fitzgerald initiated its coverage of the delivery firm with a warning that Royal Mail still faced significant challenges and that its current valuation and dividend were "no longer compelling", sending Royal Mail's shares 2 per cent lower.

The wider FTSE 100 Index closed 24.7 points higher at 6755.5, helped by a rally in Europe after an unexpected drop in German unemployment.

With more economic optimism also in the UK, the pound strengthened against most major currencies as figures revealed new car sales raced to a six-year high in 2013.

Sterling rose to 1.64 US dollars and 1.21 euros.

Royal Mail was in sharp focus after the shock sell rating, with shares 11p lower at 561p after the note of caution from Cantor.

Shares have surged from their starting point of 330p in October to more than 600p in recent weeks, but Cantor suggested now was the time for investors to sell. Banking stocks were among those making gains, with Lloyds Banking Group setting the pace with a 2.4p rise to 82.5p.

HSBC followed, up 15.8p to 675.8p, while Royal Bank of Scotland cheered 6.1p to 350.4p.

Retailers continued to fluctuate ahead of eagerly-awaited festive trading updates from Sainsbury's, Tesco and Marks & Spencer.

Investors eyed some value in M&S shares following recent heavy falls caused by speculation that the company endured a poor festive period.

The department store chain, which is due to publish its trading update tomorrow, rose 0.8p to 441.1p.

Sainsbury's edged 1.1p higher to 368.9p despite Bank of America Merrill Lynch cutting its rating on the stock. The supermarket is expected to lose its record for underlying sales increases on Wednesday, with analysts pencilling in a decline after 35 quarters of growth in a row.

Tesco was 0.5p lower at 331.8p, while Morrisons faded 2.7p to 253.6p.

[El-Bandito]

I wonder how much our competitors 'paid' Cantor Fitzgerald, who no one has ever heard of?
Sounds like one of Osborne's Bullington cohorts. Get some schmuck to put the frighteners up investors to get the share price down. Divert attention and say anything apart from the public got royally shafted with the sell off!!I

[cloherty1976]

I wonder how much our competitors 'paid' Cantor Fitzgerald, who no one has ever heard of?
Sounds like one of Osborne's Bullington cohorts. Get some schmuck to put the frighteners up investors to get the share price down. Divert attention and say anything apart from the public got royally shafted with the sell off!!I

These are one very big firm with billions of ££££ . Shares doing very nicely today so investors don't seem to be put off..

[TrueBlueTerrier]

Cantor Fitzgerald is a very well known company - in fact they lost 648 people in the 9/11 attacks.

[El-Bandito]

Cantor Fitzgerald is a very well known company - in fact they lost 648 people in the 9/11 attacks.

So that makes them experts in Royal Mail then?

[TrueBlueTerrier]

Cantor Fitzgerald is a very well known company - in fact they lost 648 people in the 9/11 attacks.

So that makes them experts in Royal Mail then?

No you said no one had heard of them, I merely posted information that in fact they are well known. They are also one of the biggest financial trading companies in the US and have offices here, in Canary Wharfe which won't come as any surprise.

[El-Bandito]

Cantor Fitzgerald is a very well known company - in fact they lost 648 people in the 9/11 attacks.

So that makes them experts in Royal Mail then?

No you said no one had heard of them, I merely posted information that in fact they are well known. They are also one of the biggest financial trading companies in the US and have offices here, in Canary Wharfe which won't come as any surprise.

Smacks of vested interest to me,TBT, an American investment Co slating RMG share price. You have to ask why?

[fishtank]

Smacks of vested interest to me,TBT, an American investment Co slating RMG share price. You have to ask why?

Of course they've a vested interest...It's their job.
They're an investment company/bank/thing, they advise clients where to stick their money in return for a cut of the profits, if their clients don't make money neither do they.
If they though investing in RM was a good idea that's what they would say but they don't because we are at the top end of our value.

All I need is the red braces and I'm set to go.
Greed is good and all that.

[dvbuk55]

Smacks of vested interest to me,TBT, an American investment Co slating RMG share price. You have to ask why?

Of course they've a vested interest...It's their job.
They're an investment company/bank/thing, they advise clients where to stick their money in return for a cut of the profits, if their clients don't make money neither do they.
If they though investing in RM was a good idea that's what they would say but they don't because we are at the top end of our value.

All I need is the red braces and I'm set to go.
Greed is good and all that.

Mein Gott I've found the Wall Street Wolf

[wacko74]

Makes me laugh when any of these financial institutions make their claims about share prices, they're just self fulfilling prophecies...

They claim a share is overpriced, shareholders panic sell and hey presto the price drops.

They claim a share is undervalued, investors buy it and hey presto the price goes up.