BXB released a 1H17 trading update which included an FY17 profit warning.
BXB announced that it expects 1H17 constant currency sales and underlying profit growth of only 3%, down from previous forecast of 7 – 10%.
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North America Pallets were impacted by both revenue and cost pressures.
We’ve been concerned about BXB’s high PE valuation and low compressed yield. To protect against the risks, we hedged BXB by approximately 5%, whilst keeping exposure to the upcoming dividend.
At $10.00 we think BXB is a new counter trend buying opportunity and any short exposure or hedging should be closed and new long positions established.
We’ll keep you informed via the blog when this change in directional strategy occurs.
