Market Report: Hilton Food beefs up to all-time high

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Thousands of City workers might be planning diets to lose the Christmas weight, but investors decided to delay their New Year regimes and chow down on shares in meat-packing firm Hilton Food Group after its latest international deal.

The company, which packs Tesco’s meat in the UK but has been expanding overseas in recent years, unveiled a joint venture with Portugal’s largest retailer Sonae following a six-month trial.

The pair will work to upgrade Sonae’s facilities at a cost of €22 million to the London-listed company. The joint venture lifted the shares 34.88p, or 5.4%, to 679.88p, an all-time high, which took its market value above £500 million.

Panmure Gordon’s Peter Smedley compared the deal with Hilton’s joint venture in Australia, which it signed in 2013. “We think the stock market will welcome Hilton allocating its surplus cash to develop its core business with such a leading retail client,” the analyst wrote. Peel Hunt agreed and raised its profit forecasts for this year and next.

The High Street doom provided by Next’s trading update put the brakes on the FTSE 100’s winning streak as it edged 2.32 points lower to 7175.57 after hitting new highs yesterday. Housebuilders including Barratt Developments, which put on 11.2p at 476.2p, propped the index up after a wave of upgrades from Deutsche Bank.

However, the investment bank was less optimistic about Bovis Homes after its surprise profit warning over Christmas and cut from Buy to Hold, a move that was matched by Jefferies. The double-whammy sent the shares down 28.14p, or 3.4%, to 792.36p.

Wound dressings maker ConvaTec was 0.87p healthier at 241.47p after a €25 million Dutch buy, its first deal since its £4.5 billion float in October.

Defence tech firm Ultra Electronics fell 59p, or 3%, to 1893p despite a  £9.7 million contract extension to keep making floating sonar systems for the Navy’s helicopters.

FastForward Innovations, backed by boss Norbert Teufelberger, jumped 2p to 13.25p after revealing US college search app Schoold, in which it has a stake, is close to a sale, and it is pursuing a float of Leap Gaming, its 3D computer games graphics investment.

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January 5, 2017 |
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