Abrdn has been tipped for a return to the top flight of UK companies by Hargreaves Lansdown, having slipped into the FTSE 250 only as recently as September.
Abrdn was relegated from the FTSE 100 at the end of last quarter, having seen its shares fall more than 40%, or just over £1, between the start of January and late August 2022. In the first six months of this year Abrdn posted a loss of £320m, with adjusted operating profit down 28% to £115m by the end of H1.
But the firm’s fortunes have reversed in recent weeks, and its share price has increased nearly 45% from £1.39 on 30 September to around £2 on 22 November.
Susannah Streeter, senior investment and markets analyst Hargreaves Lansdown, said that investor risk appetites appears to be returning, despite volatile markets and concerns about the prospects for global growth.
She said: “Investor confidence in sectors around the world has jumped over the past month, and that’s helped restore optimism about [Abrdn’s] prospects, particularly given that it’s known for its emerging markets and smaller companies’ funds.
“A bolstered direct-to-consumer offering and improved proposition are all welcome developments which could also help deliver an about turn in revenues. But the company will have to generate sustained and meaningful inflows to remove the risk of fresh volatility returning to the share price.”
Tipped to join Abrdn in the FTSE 100 is Weir Group, a Glasgow-based engineering firm, while Harbour Energy and Dechra Pharmaceuticals are set to be relegated to the FTSE 250. Betting company 888 Holdings could be demoted from the FTSE 250 to the FTSE Small Cap, while Digital 9 Infrastructure, an investment trust launched in March 2021, could very well take its place.
The update from Hargreaves Lansdown is only an indication of possible changes, and any movements between the indices will be made concrete based on market capitalisations of the respective companies on 29 November.
Any changes will be announced a day later, and will take effect after the close of business on 16 December.