DCC plc is a big name involved in the marketing, sales, and support services. However, this big name from the London Stock Exchange is down by 15% this year alone.
lot of investors were actually bullish on the DCC as they were planning to sell some of their divisions. Third-party analysts were expecting the company to get around 2.1 billion from the sales.
This would also have allowed the DCC to earn an operating income of 500 million during the year. On top of that, the growth rate of the DCC was also near 9% yearly.
However, the company only managed to sell its healthcare unit for around 1.1 billion. Now, this is a reduction of almost 15% from the earlier announced plan.
On top of that, the data from last year shows a slowdown in the energy business. Naturally, this is bad news for the DCC as they are directly involved in the energy business.
There's no doubt that the underlying business of DCC is not as good as it was a few months ago. The company is also planning to raise 700 million through a share buyback program. But many investors are not anxious and don't want to wait that long.
In fact, the stock price of DCC has already moved lower since the company started its buyback program. Looking ahead, there's not that much that would provide some relief for the DCC investors.
So, the bottom line is that investors will need to wait if they want the DCC to turn around. Now, will the investors really wait for the DCC to turn around? From the looks of it, a lot of investors will not invest as there are so many other options in the FTSE 100.
Looking ahead, the DCC stock may stabilize in the next 5-6 months, but it will already be too late by now. That's why we expect the current downtrend in the DCC stock to continue in the long term.