Aga Shares Streak Upward as Fired Earth Tiles Sell: London Mover
Aga Rangemaster Plc (AGA), the inventor of the range cooker in the early 1800s, rose for a seventh day in the longest streak in six years, as investors bet that trading will improve at the Fired Earth tile unit and in the U.S.
The shares advanced 0.4 percent to 60.25 pence at 11:52 a.m., extending their gain to 11 percent since falling to a record low closing price of 54.25 pence on Oct. 11. The volume of shares traded was almost nine times the daily three-month average.
“They are reaching a turning point,” Matthew McEachran, an analyst at N+1 Singer Ltd. with a buy recommendation on the stock, said in a telephone interview. “It is very operationally geared so it wouldn’t require much revenue growth to see a big improvement in profit.”
Aga shares have suffered this year while the U.K. endured a double-dip recession, crimping sales of its luxury ovens, though the Fired Earth tile unit reported in August that first-half revenue rose 7 percent. The Warwickshire, England-based company has introduced a five-door oven and an application to allow its Aga cookers to be controlled remotely.
Aga may announce this month in a trading update that it has signed an agreement to restructure the financing arrangements of its pension fund, giving it a three-year contributions holiday, McEachran said. The company reached agreement in principle in August with the fund trustees.
“They have had the pension issue weighing over them for several years,” McEachran said. An accord “will allow them some breathing space to focus on the business.”
To contact the reporter on this story: Peter Woodifield in Edinburgh at email@example.com.