Royal Mail share price: Liberum points to GDPR impact on marketing communications activity

Analysts weigh in on postal operator ahead of group’s trading update

Royal Mail share price: Liberum points to GDPR impact on  marketing communications activity

Liberum has pointed to the impact of the  General Data Protection Regulation (GDPR) on letter volumes at Royal Mail Group’s (LON:RMG), expecting the uncertainty to dampen marketing communications activity. The comments come ahead of the privatised postal operator’s trading update on Tuesday, July 17.

Royal Mail’s share price has gained ground in London in today’s session, having added 0.60 percent to 488.40p as of 13:06 BST. The stock is marginally outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.44 percent higher at 7,684.69 points. The group’s shares have added more than 18 percent to their value over the past year, as compared with about a 3.7-percent gain in the Footsie.

Liberum weighs in on Royal Mail

Proactive Investors quoted Liberum Capital Markets as commenting that the recent introduction of tighter rules on customer marketing with the new GDPR rules had “an uncertain impact on marketing communications activity,” and that the broker expected, at the very least, “the uncertainty to dampen activity”.

Earlier this year, the privatised postal operator warned that letter volume declines were expected to come in at the higher end of the range for the  2018-19 year due to the introduction of GDPR rules.

“Combined with more general business uncertainty, this is expected to push the current year trend in Letters volumes to (or beyond) the worse end of management’s long-term guidance range of annual falls between 4% and 6%,” the broker added, as quoted by the newswire.  

Other analysts on blue-chip group

The 16 analysts offering 12-month price targets for Royal Mail for the Financial Times have a median target of 500.00p on the shares, with a high estimate of 630.00p and a low estimate of 400.00p. As of July 6, the consensus forecast amongst 17 polled investment analysts covering the blue-chip group has it that the company will underperform the market.  

As of 13:15 BST, Friday, 13 July, Royal Mail share price is 486.90p.

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