Nigel Frith, senior market analyst at Ask Traders, on the latest Flybe and HS2 developments:
"The approval of HS2, talk of a bridge connecting Northern Ireland to Scotland and now the government considering an ownership stake in Flybe. Boris Johnson is making it very clear that he is prepared to push boundaries to improve regional connectivity across Britain. The question is a what cost?
The latest developments in the government – Flybe saga suggest that Boris isn’t willing to let anything get in the way of attempts to level up the UK. Even if this means supporting a weak business model in a company which could find support from its wealthy owners, who include Virgin Atlantic, Cyrus Capital and Stobart haulage."
Keith Bowman from Interactive Investor on TUI’s first quarter update:
"With so many factors outside of management’s control potentially influencing performance such as terrorism, fuel prices, currency movements, the holiday business is often a volatile and high-risk industry in which to invest.
For TUI itself, the demise of rival Thomas Cook has reduced industry capacity, allowing TUI to sweep up many of Cook’s customers and help fuel current strong bookings. A rebasing of the dividend, although not a surprise, was a disappointment, even if arguably sensible given the Boeing related uncertainties and increased financial flexibility.
For investors, consumer confidence remains key. Brexit trade negotiations and recessionary German economic conditions offer a tough backdrop. Following 2019’s dividend reduction, a one-year estimated yield of just over 3% still offers some attraction, while a forward price/earnings (PE) ratio below the three-year average suggests a valuation which is not excessive."
