MARKET REPORT: Good news for Unite as record number of students heads to university

By Geoff Foster for MailOnline

Updated: 03:30 EDT, 15 August 2014

A record number of students will be flying the nest and heading to university this year after receiving their A-level results.

That must be music to the ears of Mark Allan, boss of specialist student accommodation provider Unite Group (6.8p up at 413.8p). Ucas, which handles the admission process, says 396,000 people have gained places on degree courses, up 3 per cent on last year.

Unite, founded in 1991 by Nicholas Porter, is now in 23 of the strongest university cities across the UK, from Aberdeen to Plymouth.

Student accommodation long ago moved away from the 1960s-style council blocks and draughty old halls of residences to safe, modern apartments. Unite builds and manages all types of student digs, including the world’s tallest student block in Leeds.

Unite is adding to its portfolio all the time. Last month a fund 21 per cent owned by Unite, acquired a further 2,904-bed student accommodation portfolio for £137million. This followed its purchase of a suite in Portsmouth which created another 830 new beds in the city.

The Footsie, 28.58 points better at 6,685.26, behaved itself after Russia’s  President Putin eased concerns over the Ukraine crisis. He said Russia would stand up for itself but not at the cost of confrontation with the outside world. His words helped Wall Street climb 36 points higher in early trading.

Buying in response to a lucrative refinery contact awarded to the oil equipment and services group in Malaysia helped Petrofac climb 35p to 1144p.

Property giant British Land rose 17.5p to 724.5p after Bank of America/Merrill Lynch upgraded to buy from neutral.

TUI Travel added 7.8p at 369.7p after the boss of German holiday group TUI AG – in merger talks with its 55 per cent-owned London-listed unit – said the merger process was  ongoing and there was no Plan B. Full-year results could beat guidance. Following a meeting with the HSBC management, Killik said it remained buyers of the stock which closed 13.1p higher at 651.4p.

The broker believes it is one of the few truly global banks, both for corporate and individual customers. It is well placed to benefit from continued globalisation and the shift of economic power to Asia, with a strong position in Greater China as the leading Hong Kong bank.

A Credit Suisse downgrade to neutral dragged Glencore 4.85p lower to 360.65p. The broker continues to favour its base metal exposure over the medium term, but now sees three short-term headwinds. Commodity momentum may fade in the second-half, earnings have not kept pace with performance and it now sees more than 10 per cent downside risk to 2015 figures. The group’s valuation is now at a premium to peers with only modest upside to its target price of 380p.

Ophir Energy jumped 13.2p to 211.7p after a half-year profit, helped by the sale of assets in Tanzania. It sold a 20 per cent interest in Blocks 1, 3 and 4 in Tanzania to Pavilion Energy for £748million with £23million payable in the final divestment decision. Proceeds from the sales will be used to help fund other exploration projects. The board has also approved a share buy-back programme of up to about £600m.

Renewed selling left accident prone Centamin 4.6p down at 69.9p. The gold miner warned that an appeal case hanging over its right to mine gold in Egypt is likely to drag into next year. Mining will continue pending its resolution. Centamin is appealing a 2012 court ruling that declared its right to operate its only mine, Sukari, invalid.

Fastnet Oil & Gas gushed 2.55 per cent to 5.025p after entering into an amended exclusive option agreement with PSE Kinsale Energy, a wholly owned subsidiary of Petronas, in relation to the ‘Deep Kinsale Project’. Fastnet has secured improved commercial terms from those previously announced in February 2013. Cantor’s target price is 19p.

News of a placing of 7.68million shares at 20p a pop to raise £1.5million as part of a £4.5million financing package left cloud expert Outsourcery 0.5p dearer at 23p. Buyers chased Graphene Nanochem 3.25p higher to 54.75p after its filing of a patent for PlatSperse, a multiphase fluid dispersion device that will allow it to explore more applications of grapheme.

Dual-listed last month, satellite communications equipment manufacturer Global Invacom improved 0.5p to 23p following strong interims. Revenues rose 26.3 per cent to £42million and pre-tax profits 23 per cent to £2.6million.

Manx Financial, the financial services group which takes in Conister Bank, gained 0.25p to 14.25p following an upbeat trading statement. The board also dangled a carrot by saying it would make an announcement soon regarding a new joint venture focusing on insurance premium and asset-backed finance for the UK professional business sector.

- AIM-listed Physiomics, the Oxford systems biology company, surged 22 per cent to 2p after a deal with an unnamed global pharmaceutical company to adapt its Virtual Tumour clinical technology to immunomodulatory agents, a significant focus of cancer research. The initial phase of the project, which starts immediately and will be completed by the end of the year, will focus on making pre-clinical predictions. It will be performed on a fee-for-service basis.