Global share markets are ending April on a high. The FTSE 100 is currently taking in six-week highs just short of 6,000 points, leading to hopes of more progress in May.
The loosening of lockdown measures the world over are helping to buoy investor confidence today. But of course share picker sentiment remains fragile and any deterioration in Covid-19-related newsflow could send equity bourses sinking again.
It pays to remain well protected, then. And one way that stock investors can do this is by buying shares in Plus500. It’s likely that we haven’t seen an end to the severe volatility that’s rocked financial markets since late February. So this business — which provides an online trading platform for contracts for difference (CFDs) — is well placed to continue enjoying rampant revenues growth,
The impact of recent turbulence on Plus500 is underlined in fresh financials released today. The FTSE 250 firm says that “heightened levels of market volatility have persisted, and the company has continued to see a significantly increased level of customer trading activity.” It follows on from an eye-popping update on April 7, one in which it advised that revenues had soared almost 500% during the first three months of 2020.
Plus 500 says today that “all financial and operational KPIs remains very strong.” It continues to attract “significant” numbers of new clients, it comments, whilst it is also witnessing stronger trading activity amongst its existing customers. Consequently the trading giant is seeing customer income — that is turnover from customer spreads and overnight charges — in the first half of 2020 to date remain at all-time highs.
Share markets have been more stable this month compared with February and March. This has not dulled business over at Plus500, though. In fact the company says that “the group’s financial performance during the second quarter [is] continuing to show further momentum following an exceptional first quarter.”
It’s no wonder, then, that Plus500 affirms its belief that both revenues and profits for the full year will be “substantially ahead” of market expectations.
On The Up
The Israel-headquartered company’s share price has powered 5% higher in Tuesday’s session following the release. It’s now trading at fresh record peaks just shy of £13.
Plus500 has seen its value swell more than 50% since the coronavirus crisis first shook financial markets back in mid-to-late February. Yet it still trades on a rock-bottom forward price-to-earnings (P/E) ratio of around 7.5 times.
Considering there’s a strong chance that City brokers, who currently expect annual profits to rocket 61% in 2020, will keep upgrading their forecasts in the weeks and months ahead this makes Plus500 look even more of a bargain. Throw in a mighty 6% dividend yield, too, and I reckon this soaring stock is worth serious attention today.
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