Top UK Stocks: Mitie shares rise as outlook improves

Mitie starts to ascertain Covid-19 work fall away as offices reopen, AstraZeneca shares pop on positive results from Lynparza, Avon Protection wins a contract extension, Tortilla Mexican Grill outlines IPO plans, and that we check out what to expect before an update from Carnival later.
Top News: Mitie ups guidance as Covid-19 work starts to ease
Outsourcer Mitie Group said it’s raised its full year guidance after continuing to profit from Covid-related contracts within the second quarter.

The company said it’s now expecting to deliver an adjusted operating profit of between £145 million to £155 million over the complete year. that might be a big jump from the £63.4 million booked last year and therefore the £86.1 million booked within the prior year before the pandemic hit.

That target range is additionally well before the £107.9 million annual profit forecast by analysts, consistent with data from Refinitiv.

Mitie shares were trading 3% higher on the news.

The upgrade has been made after the momentum seen within the half-moon continued into the second. Mitie said this was primarily right down to delivering variety of short-term Covid-related contracts. The firm has been helping the govt with everything from providing security to quarantine hotels to helping found out and run testing centres.

Mitie said work associated with the pandemic is predicted to ease because it moves through the last half of its current fiscal year to the top of March 2022, but said it had been confident enough to up expectations following its first-half performance and a recovery in other parts of the business.

‘Excluding COVID -related contracts, the business has continued to perform in line with expectations, with the gradual recovery of the economy and therefore the return to figure ,’ said Mitie.

With that in mind, Mitie said the mixing of Interserve’s facility management business that it bought back in 2020 remains on target which the unit is ‘performing well’.

‘Current market expectations for FY23 are unchanged, pending full recovery of our discretionary variable and project add our technical services business to pre-COVID levels and until any longer COVID-related work is judged to be likely in FY23.

Mitie also revealed it’s secured a replacement £150 million open-end credit facility to exchange an existing £250 million facility that it took call at the first days of the pandemic.

The company plans to release interim results covering the six months to the top of September on November 18.

Where next for the Mitie share price?
After trending lower since the beginning of the month, the Mitie share price rebounded off 67.4p a six week low on Tuesday.

The share price has extended the move higher, breaking above the 50 & 100 sma on the four hour chart also as above its falling trendline, keeping the buyers optimistic. The RSI is supportive of further upside whilst it remains out of overbought territory.

Immediate resistance are often seen at 75p the high September 10 & 14. Beyond here buyers could gain momentum and head toward 77.7p the August high.

On the downside support are often seen around 71.5 the 50 and 100 sma. an opportunity below here exposes 67.5p the September low.

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