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5 UK Stocks That Dropped on Brexit Launch

GuruFocus.com

- By Holly LaFon

The London market was largely impassive Wednesday as British Prime Minister Theresa May formally started the process to separate the U.K. from the European Union, though it was unkind to some stocks.

The U.K.'s Financial Times Stock Exchange 100 Index, which traces the movements of the 100 London Stock Exchange companies with the largest market caps, rose 17.8% since the June 26 referendum vote to withdraw from the European Union, after a brief drop the following week. On Wednesday, the index recovered from a slight decline to rise 0.41% by the end of the day.

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May commented on the bumpy road ahead for the region in a speech to Parliament on Wednesday that notified the European Council of the U.K.'s resolve to break from the EU.

"Mr. Speaker, we understand that there will be consequences for the UK of leaving the EU," she said. "We know that we will lose influence over the rules that affect the European economy. We know that UK companies that trade with the EU will have to align with rules agreed by institutions of which we are no longer a part, just as we do in other overseas markets. We accept that."

She also highlighted some of her economic objectives.

"We will pursue a bold and ambitious free trade agreement with the European Union that allows for the freest possible trade in goods and services between Britain and the EU's member states; that gives British companies the maximum freedom to trade with and operate within European markets; and that lets European businesses do the same in Britain," she said.

The large cap U.K.-based stocks on the London Stock Exchange that slid the furthest amid Brexit proceedings were: Fresnillo PLC (FRES.L), Ryanair Holdings PLC (RYA.L), International Consolidated Airlines Group (IAG.L), and Prudential PLC (PRU.L) and Legal & General Group Plc (LGEN.L).

Fresnillo PLC (FRES.L)

Fresnillo, a gold and silver mining company focused on Mexico and incorporated in England and Wales, saw its stock decline by 1.7% on Wednesday, for a total climb of 53% in the past year.

Fresnillo PLC has a market cap of $11.51 billion; its shares were traded around $15.35 with a P/E ratio of 35.61 and P/S ratio of 7.56. The trailing 12-month dividend yield of Fresnillo PLC stocks is 0.58%. The forward dividend yield of Fresnillo PLC stocks is 1.54%. Fresnillo PLC had an annual average earnings growth of 10.4% over the past 10 years.

Ryanair Holdings PLC (RYA.L)

Ryanair Holdings, an airline operator mainly to Europe and based in Ireland, saw its stock decline 1.1% Wednesday, for a one-year decline of 14.7%.

Ryanair Holdings PLC has a market cap of $17.63 billion; its shares were traded around $14.14 with a P/E ratio of 12.84 and P/S ratio of 2.62. Ryanair Holdings PLC had an annual average earnings growth of 14.1% over the past 10 years. GuruFocus rated Ryanair Holdings PLC the business predictability rank of 2.5-star.

International Consolidated Airlines Group (IAG.L)

International Consolidated Airlines Group, a multinational airline with headquarters in London and registration in Madrid, Spain, saw its stock decline by 0.8% Wednesday, for a total decline of 16.4% for the past year.

International Consolidated Airlines Group SA has a market cap of $11.31 billion; its shares were traded around $5.31 with a P/E ratio of 6.93 and P/S ratio of 0.58. The trailing 12-month dividend yield of International Consolidated Airlines Group SA stocks is 3.28%. The forward dividend yield of International Consolidated Airlines Group SA stocks is 3.43%. International Consolidated Airlines Group SA had an annual average earnings growth of 23.3% over the past five years.

Prudential PLC (PRU.L)

Prudential, an international financial services group based in London, saw its shares decline 0.8% Wednesday, for a total one-year decline of 17.2%.

Prudential PLC has a market cap of $44.42 billion; its shares were traded around $17.08 with a P/E ratio of 22.97 and P/S ratio of 0.61. The trailing 12-month dividend yield of Prudential PLC stocks is 2.29%. The forward dividend yield of Prudential PLC stocks is 2.53%. Prudential PLC had an annual average earnings growth of 9.2% over the past five years.

Legal & General Group PLC (LGEN.L)

Legal & General, a financial services company focused on insurance and investment management, saw its shares decline 0.6% Wednesday, for a total decline of 39.2% for the year.

Legal & General Group PLC has a market cap of $14.74 billion; its shares were traded around $2.46 with a P/E ratio of 11.71 and P/S ratio of 0.19. The trailing 12-month dividend yield of Legal & General Group PLC stocks is 5.64%. The forward dividend yield of Legal & General Group PLC stocks is 5.8%. Legal & General Group PLC had an annual average earnings growth of 15.1% over the past five years.


See more stocks trading lower at a Brexit screener here.

This article first appeared on GuruFocus.