Shares in Unilever (LON:ULVR) have been subdued in London in today’s session, slightly underperforming the broader UK market, ahead of the company’s first-quarter update tomorrow. The results will come after the Anglo-Dutch consumer goods group recently published the outcome of its shareholder review, announcing plans to offload some spread brands and return cash to investors.
As of 14:03 BST, Unilever’s share price had lost 0.61 percent to 3,941.12p, as compared with a 0.31-percent drop in the FTSE 100. The group’s shares have gained more than 18 percent over the past year, and are up by some 19 percent in the year-to-date.
Unilever is scheduled to update investors on its first-quarter performance tomorrow and Proactive Investors reports that analysts at Numis expect the FTSE 100 company to post like-for-like sales growth of 0.6 percent.
The update will follow the FTSE 100 group’s strategic review prompted by Kraft Heinz’s failed bid earlier this year. Unilever plans to exit its Spreads business, which includes brands such as Flora, launch a €5-billion share buyback this year, as well as hike its dividend by 12 percent.
“For Unilever, the main task at the moment is keeping investors happy. It has started to do this with a decision to sell off parts of its underperforming food businesses,” Chris Beauchamp at IG commented in a note last week, adding that increases to payouts are “likely to be a theme in future updates”.
“This time around, investors will want to see core businesses such as personal care do well, along with indications of progress on margin improvements,” the analyst pointed out.
As of April 14, the consensus forecast amongst 21 polled investment analysts covering Unilever for the Financial Times has it that the company will outperform the market. According to MarketBeat, the blue-chip group currently has a consensus ‘hold’ rating and an average price target of 4,008.48p.