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The most popular shares in November

Nicholas Hyett assesses some of the shares most popular with HL clients in November.

Important notes

This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in.

November’s most popular shares

The lists below show the FTSE 100 and FTSE 250 shares (excluding investment trusts) with the highest number of net buys (buys minus sells) among HL clients in November. We’ve also included the most popular large* overseas shares (excluding investment trusts and ETFs).

More about international share dealing

Shares listed alphabetically.

*Of equal or greater size than the market capital of the smallest FTSE 350 stock.

These are provided for your interest, but aren’t a guide as to how you should invest. You should consider your own aims and attitude to risk before making any investment decisions, and remember that investments will fall as well as rise in value so you could back less than you invest. Past performance is not a guide to the future. Please remember yields are variable and not guaranteed. If you’re not sure whether an investment is right for you, please seek advice.

Imperial Brands

There was no major share price move following November’s full year results, but the numbers were still good enough to put Imps on our most popular list. It once again posted a modest rise in net revenues, despite lower tobacco volumes, thanks to further price hikes.

However operating profits dipped 2.4% as margins face the brunt of extra investment in Next Generation Products. This is a small part of the business today, but important part of the group’s future growth. Unfortunately a spate of vaping related illnesses and backlash in the US has hit demand, and there’s talk of increased regulation. Because the division isn’t a headline act, that’s not burning a hole in profits – but it’s something to keep an eye on as we head into the new financial year.

In reality, the real star atop Imperial’s tree is its 12.2% dividend yield, with further, dividend rises expected, although these aren’t guaranteed. The group’s also returning money to shareholders through buybacks, which seems sensible to us given the price to earnings ratio of 6.3, significantly below the longer-term average. So far £200m has been earmarked for buybacks by the end of 2019, and we could have news of further plans in the new year.

Investors should bear in mind though that long standing CEO, Alison Cooper is stepping down, and as yet we don’t know who her successor is. When a new top dog is found, he or she will inevitably want to put their stamp on things, so there’s scope for a change to the current status quo.

All-in-all, we can understand why the group garnered attention in the month, but Imps is spinning a lot of plates, and the path ahead likely contains some big changes, and the going might not be totally smooth.

See the Imperial Brands share price and charts

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Tullow Oil

November wasn’t the easiest for Tullow. The shares fell 21.3% following third quarter results, and the slide has continued. That does mean the shares now trade on a price to earnings ratio of 9.4, compared to a little north of 12 at the start of the month. But there are some reasons to be cautious.

The results highlighted a sticky concoction of issues. First up was drilling issues at the Ghanaian TEN oil field, this is a major production site, meaning group full year production is expected to come in below previous guidance.

The salt in the wound came from the new discovery in Guyana, which has turned out to be of very low quality, meaning it’s unlikely to serve as a future cash flow-booster. We can expect to hear further results from other wells in this region later in the year, and some better news would be very well received. Questions have inevitably been raised about the whole basin though.

It’s debatable whether the company deserves the pasting it had last month, but in the short-term investors will simply be hoping for no more hiccups. Debt remains a little high and a fall in the oil price wouldn’t help the situation. Resolving issues in Ghana remains top of the to-do list, since this pays the bills and the now quite sizeable dividend yield.

See the Tullow Oil share price and charts

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Uber

Uber’s hit a few bumps in the road. Since listing in May, the shares have fallen 29%. Of course, the current issue hitting headlines hardest is news it has lost its London licence.

Transport for London said this was largely to do with safety concerns, which isn’t the first time Uber’s faced such criticism. And a regulatory backlash is the last thing a company that isn’t actually making any money needs.

In the third quarter, Uber’s cash losses rose 28% to $585m, as it ramps up investment in new products like Uber Eats. At the same time, the group said this is a peak investment year, and cash profits should start to appear from 2021.

It’s unclear yet exactly how that will happen, or how it could be maintained, as the competitive landscape is peppered with intruders, which isn’t likely to change. Uber has some advantages because it still boasts enormous market share, but we suggest keeping an eye out for any more changes in the regulatory temperature – and some clearer guidance on exactly how Uber plans to take its foot off the cost pedal.

See the Uber share price and charts

The Author holds shares in Imperial Brands.

Before you can invest in US companies you’ll need to complete a W-8BEN. Find out more about the charges.

Unless otherwise stated estimates, including prospective yields, are a consensus of analyst forecasts provided by Thomson Reuters. These estimates are not a reliable indicator of future performance. Yields are variable and not guaranteed. Past performance is not a guide to the future. Investments rise and fall in value so investors could make a loss.

This article is not advice or a recommendation to buy, sell or hold any investment. No view is given on the present or future value or price of any investment, and investors should form their own view on any proposed investment. This article has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is considered a marketing communication. Non-independent research is not subject to FCA rules prohibiting dealing ahead of research, however HL has put controls in place (including dealing restrictions, physical and information barriers) to manage potential conflicts of interest presented by such dealing. Please see our full non-independent research disclosure for more information.

Important notes

This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in.

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