From a fundamental viewpoint, analysts have largely revised downward their EPS estimates. Thus, even if sales are expected to increase in the coming years, the net income should radically lower than last year. In facts, net margin should come back to its 2008 level, erasing 5 years of improvements. Most of all, analysts don’t see any margin rise in the coming years and they keeps on decreasing their EPS estimates. Finally, the consensus is split with several analysts recently giving a sell recommendation on the stock.

Technically, the stock has been following a downtrend for several months. The share is now approaching an important support level that stopped the downward movement on several occasions. However, the poor fundamentals and the moving averages orientation call for a further correction of prices if they cross the GBp 72.3 support area.

Therefore, a short position could be taken under GBp 72.3 with a target set at GBp 63. Nonetheless, a stop loss will be place above the support level protecting from a bullish overflow.