Stagecoach is a major leader in transportation infrastructure.

Stagecoach is a massive operator in the UK for transportation. The company currently has a 26% market share on the bus travel sector, followed closely by FirstGroup (21%). Stagecoach has been around since 1980 and went pubic 13 years later in 1993. In the past 5 years, however, the company looks to be taking a turn for the worst – COVID19 will hurt the company badly.

The financials for stagecoach are very mixed. Current market capitation is £292.42m with 2019 revenue at £1.878bn - a 3.3% drop from 2018. Profit after tax was small at £23.6m. In 2018 this number was £63.8m. The balance sheet is okay though. Cash on hand for the company is £170.4m, a drop of around 28% from 2018 (£238m), with total assets at £1.296bn down from £1.897bn, liabilities have also shrunk too to £1.168bn from £1.716bn – this tells me the balance is shrinking which could indicate limited growth for the future. Net positive assets of £128.4m remain though.

From a technical aspect, the stock is negative, MACD trends firmly down with the Bollinger band support this. RSI (though not on here) does indicate cheap value at 35 and is close to oversold conditions. Importantly though, the chart is now at its low for the year at 0.53p. A break below this major support could take this market much further down to 0.50p and then 0.40p. To the upside, resistances sit at 0.58p and major resistance at 0.61p. A break above 0.61p could take this stock up 0.73p.

This stock has to be looked at from a fundamental point more than technical as buses are critical infrastructures to cities in the UK. This means governments will help subsidise them to ensure they keep operating. Stagecoach at current is in an okay position, but will most likely need help going forward and hence why the share price is still low. Peoples confidence will have dropped in public transport and the idea of being close to someone isn't acceptable anymore, though for some people there is no another way. As things return to normal this share should be reflective of this but it could take some years before operations are pre-COVID and £1+ per share is seen.