FTSE 100 flat as Vodafone posts strong Q4 sales growth
On Tuesday, the FTSE 100 didn't make much progress as it remained in a stable position after achieving a successful milestone. This was due to some positive earnings reported by Vodafone and the ongoing takeover negotiations involving Anglo American.
On Tuesday, investors were not able to trade much due to the limited number of macro factors. As a result, the index has only risen by 0.1% at the time of writing.
According to Russ Mould, who is the investment director at AJ Bell, the FTSE 100 had a great period where it reached its highest point ever. But now, it seems to be in a state of stagnation, waiting for something to happen that will either push it up or drag it down.
On Tuesday, the lack of significant trading activity driven by macro factors was replaced by a series of announcements from companies listed on the FTSE 100.
The situation with BHP's desire to acquire Anglo American has become quite a story.
On Tuesday, Anglo American experienced another drop in its stock price. This came after the company rejected a new offer from BHP on Monday and then revealed their plans to sell off certain parts of the organization on Tuesday. This includes their diamond mining business, De Beers.
Yesterday, Anglo American experienced a significant decrease in their stock value, dropping by 2.4%. This happened because it was revealed that a new offer for BHP to take over Anglo American through an all-share agreement was presented to the Board, but it was rejected by all members. Derren Nathan, who is the head of equity research at Hargreaves Lansdown, reported this news.
It's possible that there will be more surprises in store for this story, as Glencore, a competing company, is also rumored to be considering Anglo's wide-ranging mining assets. However, Anglo is not giving up easily and has announced today that it will concentrate on top-quality resources in the areas of copper, high-end iron ore, and agricultural nutrients. They have plans in motion to separate or withdraw from coal mining, nickel, platinum, and the world-famous De Beers diamond business.
Vodafone did really well today, gaining 3.2% after they revealed that their revenue in Q4 had increased a lot. This was because of the CEO's plans to make changes, which are starting to show success.
Investors who have continuously faced a decrease in sales growth are eagerly awaiting the news that is to come, hoping for an increase in share prices.
Matt Britzman, who works as an equity analyst at Hargreaves Lansdown, stated that Vodafone is experiencing a rebound in growth thanks to the fourth quarter.
Throughout the year, Vodafone worked hard to achieve revenue growth in all areas. Finally, in the last quarter, they were successful in accomplishing their goal. Vodafone had to let go of unprofitable businesses to concentrate on expanding their primary markets. However, investors need to understand that the company has become smaller as a result. This will affect the dividend payout, which is now set at 4.5 cents per share for 2025. It is half of what Vodafone paid out in the previous year.
Burberry experienced the highest increase of 3.4%, anticipating upcoming results later in the week.
