Clarkson stock price surges 15% as profit rises

Clarkson stock price surges 15% as profit rises
Written by:
Michael Harris
10th August, 11:12
  • Clarkson posted a first-half profit of £21.1 million, slightly higher than £20.1 million in 2019
  • Revenue surge to £180.4 million, up from £167.8 million a year ago
  • Clarkson stock price up 15% in London today to print a new 5-week high

Shares of Clarkson PLC (LON: CKN) soared 15% on Monday after the firm reported a “robust first-half performance”. Clarkson stock price is now trading above GBX2400 to log a new 5-week high. 

Fundamental analysis: Profits beats expectations

Clarkson, a major shipping company from the UK, posted a first-half profit of £21.1 million, slightly higher than £20.1 million from a year ago. The underlying earnings per share came in at 51.4p, compared with 48.5p last year. 

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“Clarksons has delivered a positive first half during 2020 despite the unprecedented challenges that we have all faced,” Andi Case, Clarkson’s chief executive said in a statement. 

The shipping firm saw its revenue surge to £180.4 million, up from £167.8 in 2019. Still, Clarkson withdrew its full-year guidance due to the uncertainty stemming from the pandemic. 

On the back of the strong H1 performance, the company will pay the equivalent of the deferred 2019 final dividend as a bonus in the amount of 53p per share. Moreover, Clarkson declared an interim dividend for this year at 25p per share.

“The company has produced strong cash flow, boosted by the excellent performances of our broking and research divisions, allowing the board to pay the equivalent of the 2019 final dividend as well as an interim dividend for 2020. We have delivered 17 consecutive years of dividend growth”.

Earlier this year, Clarkson’s rival APM Maersk projected a problematic year for global shipping business amid the pandemic. 

Technical analysis: Stock shoots higher

Shares of Clarkson surged around 15% following the release of trading performance for the first half of the year. Clarkson stock price briefly traded above GBX2400 for the first time in 5 weeks. This way, the series of the lower highs has been broken.

Clarkson stock daily chart (TradingView)

The buyers are now fighting to force a close above the 100-DMA at GBX2286. As this is likely to be the case today, the bulls will then use this indicator as a base for a bigger push higher in the coming days and weeks. The next target to the upside is 200-DMA at GBX2540.

Summary

Clarkson share price erupted higher on Monday after the shipping firm posted higher profits and revenue compared to a year ago. Shares are now trading at a 5-week high as the bulls prepare for a move above GBX2500.

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