Today, I’m looking at companies on the UK stock market that have made waves over the past week. So here’s my pick of an interesting trio.
Aviva
Insurance giant Aviva (LSE: AV) gave us a pleasant surprise with the release of first-half results. The previously troubled company has been undergoing restructuring over the past few years. And under the guidance of CEO Amanda Blanc, it seems to be going well.
The share price chart looks a bit confusing with an apparent sharp dip in May. But that was just down to a share reorganisation as part of the company’s return of capital to shareholders.
The big rise in response to the latest update is real though. The Aviva share price jumped 12% on the day. The big news was a 40% rise in the interim dividend, and plans for a new share buyback at full-year results time.
Aviva looks a good bit leaner and more efficient than it used to. And the turnaround is progressing a bit faster than I expected when I bought some shares.
There’s still risk though. Aviva recorded an IFRS loss after tax of £633m, and I’ll keep an eye on that for sure. And we can only guess at what the economy is going to do to the insurance sector.
Antofagasta
Antofagasta (LSE: ANTO) is one of the world’s biggest copper miners. And its first-half results this week reflected a key sector change.
Antofagasta slashed its interim dividend by 61%. Investors received 23.6 cents per share last year. This time it’s just 9.2 cents.
It’s not the first in the sector to do this. In July, Rio Tinto cut its first-half ordinary dividend by 29%. And the big special dividend it paid last year wasn’t repeated.
Antofagasta seems to be doing fine though. And it’s just responding to the cyclical nature of commodities market. The firm pays out 35% of earnings as dividends. And earnings are lower this half due to reduced world demand. The economy in China is suffering under its zero-Covid policy, for example.
We should expect erratic dividends from the sector. And this update reminds us to be wary of “Miners offering double-digit dividend yields” headlines.
Just Group
Just Group (LSE: JUST) also gave us interim figures this week. The company provides retirement management services. It offers insurance, pension plans and things like that. And I reckon it could be a handy barometer of how long-term financial sentiment is going.
After a sharp fall earlier in the year, the Just Group share price has been picking up strongly since the middle of July. For the first half of 2022, the company recorded a 15% increase in underlying operating profit. Retirement income sales were down 3% though. But one thing points to a strong long-term outlook to me.
Just has a record pipeline of over £5bn, which it says means it should exceed growth targets this year. There’s big demand for Defined Benefits products too, which suggests people are seriously planning for their old age.