De La Rue Share Price Forecast June 2021 – Time to Buy DLAR?
Please note that we are not authorised to provide any investment advice. The content on this page is for information purposes only.
United Kingdom-based Banknote printer De La Rue (LSE: DLAR) is in the news lately after reports emerged that the company could be sold to one of its rivals. Its share prices have increased by 13% during the pandemic ridden last year. However, Analysts think that the company will experience a downtrend as soon as the use of physical cash declines in the market. The share has lost around 60% of its value over the last 5 years. Despite this, there is considerable investor interest in the company, with many asking the question of whether the shares are worth buying in June.
De La Rue plc. – Technical Analysis
The financial statement of De La Rue plc. reveals that the market capitalization of the company is £380.382 million and a Price to Earnings Ratio of 56.3584 (TTM). The company achieved revenue of £397.40 million with a profit margin of 1.59%. This is a harsh decline from the £466.80 million in 2019.
Moving over to the technical information, Relative Strength Index (14) (67.6), Stochastic RSI Fast (3, 3, 14, 14) (100.0), Bull Bear Power (22.5), Ultimate Oscillator (7, 14, 28) (58.1) and the other oscillators for De La Rue plc. point towards neutral. On the other side, Moving averages such as Exponential Moving Average (50) (183.7), Simple Moving Average (200) (167.8) and Hull Moving Average (9) (195.1) are pointing towards buy. DLAR shares closed on June 28th at £198.0 with an uptrend of 1.54%.
67% of all retail investor accounts lose money when trading CFDs with this provider.
Recent Developments
De La Rue plc. is in the news lately after its biggest shareholder Activist Investor Crystal Amber started making plans to sell its stake. The fund leads a £100 million fundraiser after buying into the company 2 years ago, urging a change in management. However, recent reports indicate that the fund is in negotiations to dispose of its 14% holdings. Germany’s Giesecke & Devrient, Crane Currency of the US and several of De La Rue plc.’s rivals are potentially interested in the stake. The group has previously rejected a proposal from French giant Oberthur Fiduciaire.
Should You Buy DLAR Shares?
Investors should first look at fresh consumer payments data from UK Finance to evaluate the condition of De La Rue plc. Contactless transactions in the UK now account for 27% of total transactions compared to a mere 7% four years ago. This is not a good sign for money printing companies such as De La Rue plc.
Despite all of this, the company is an example of a turnaround. It is currently investing a significant amount of cash to cut costs, which should result in higher profits. The Covid-19 pandemic has caused delays in orders for the company. However, the management is positive in making plans to increase its sales from £69 to £100 million.
So, De La Rue plc. currently faces the challenges of a large amount of net debt and an enormous pension deficit. However, the growth target mentioned above is one of the primary reasons you should add these shares to your watch list.
Buy De La Rue Shares at eToro, the World’s #1 trading platform!
