Numis cuts Fidessa to 'add' from 'buy' on uncertain outlook post Brexit

1st Aug 2016 08:52

(ShareCast News) - Numis cut its rating on Fidessa Group to 'add' from 'buy' on Monday and raised the target price to 2870p from 2800p after the company reported its first half results.The group, which supplies trading systems to the financial services sector, reported a 14% increase in pre-tax profit to £22.2m in the six months ended 30 June 2016 on a 9% increase in revenue to £158.3m.Chief executive Chris Aspinwall said structural and regulatory changes have resulted in new opportunities and high levels of new business activity. Combined with a weaker pound, Fidessa has seen "strong growth" during the first half, Aspinwall said.However, the company expects to see an increased headwind in 20167 a result of consolidations and closures in 2016. Fidessa also warned there was a "degree of uncertainty" surround the Brexit vote."The outlook is consistent with previous statements, although marginally more cautious given the unknown impact of Brexit on deal timings," said Numis."With the shares up 23% since our 6 July upgrades, our recommendation moves back to a very comfortable 'add' on a slightly increased 2870p target price (was 2800p)."Shares rose 4.75% to 2,556p at 0904 BST.