Market report: William Hill stumbles as Investec says there are better bets elsewhere

Unlucky punters weren’t the only ones out of pocket after Royal Ascot — investors in the bookies were also feeling the pinch today as analysts suggested sporting results over the past two months hadn’t gone their way either.

The main target of sellers was William Hill as Investec slashed its rating to Sell and dropped its target price to 245p, knocking shares down 10.8p, or 4.1%, to 251.6p — a one-year low for the FTSE 250 firm.

The bank’s Alistair Ross warned about “punter-friendly sports results” since its trading update in early May and now expects gross win margins to be “significantly lower” for the final two months of its first-half, results for which are due out at the start of August.

He also said the “tough comparables” from last year’s Euros — a popular betting event for punters — will make the results look even worse.

Also on the cards are the betting review into fixed-odds betting terminals, a credit betting ban in Australia and higher costs, making the analyst’s advice to steer clear of Hills seem a good call.

Numis’s number-crunchers were similarly downbeat about recent trading. “Sporting results and regulation have not been kind to William Hill in recent months,” they wrote, adding that there was “no guarantee” of making up the lost ground in the second half of the year.

The broker said many of the factors hurting William Hill would also hit Ladbrokes Coral, which dragged its shares down 0.9p to 112.8p. Paddy Power Betfair did not fare much better as it fell 130p to 8510p.

The FTSE 100 leaked 23.11 points lower to 7423.69 along with other European markets, even though miners put on a strong show, with Anglo American up 23.5p, or 2.4%, to 998p.

Allied Irish Bank rose on the lender’s return to the stock market. It was up 8% at €4.76 after floating at €4.40.

Driveshaft maker GKN reversed 8.7p, or 2.5%, to 337.4p as it felt the force of a profit warning from German car-parts maker Schaeffler.