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19 November
Things are looking up for Johnson Matthey (JMAT) after the company announced an attractive set of dividend treats following the sales of its underperforming precious metals refining businesses (and despite a poor H1 earnings report). Shares in JMAT started selling off in late spring and recently settled into a fresh 2-month trading range some 30% below May highs. A break above current resistance 2360p could herald the beginnings of a recovery, but with Johnson Matthey’s dividend yield still only around 2.7%, will this be enough to tempt income seekers when the miners and oil majors are yielding 3 or 4 times that? Note also that headwinds in the form of weak platinum prices and a lacklustre outlook in chemicals markets are likely to deter those in search of capital returns for the time being. A return to those May highs might be a tall order.
Augustin Eden, Research Analyst
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