The share could soon begin a consolidation phase.

The fundamentals remain very fragile as sales and margins are decreasing for many years. Moreover, financial situation of the company is complicated. Debt keeps growing while EBITDA is not following at the same pace, leading to a leverage of 2.83 in 2013. Furthermore, this ratio should reach 3.25 at the end of 2014 as debt is expected to rise of 13% reaching USD 2 billion for USD 1.2 billion revenues. The security seems highly overvalued compared to other securities in its sector. P/E ratio of 25.6 for 2014 estimates, downward revenues and EPS revisions confirm the likelihood of an upcoming correction phase.

Technically, the security could run out of steam close to the GBp 763.5 resistance. Indeed, the stock is moving in an upward trend in the short term but it could know a halt near this level that was tested several times. In this context, a consolidation phase could begin with a return on GBp 701.5.

Due to the technical configuration and a poor fundamental situation that does not justify the current valuation of the group, investors can open a short position close to the GBp 763.5 resistance. The price target is set at GBp 701.5 and a stop loss will be placed above the resistance protecting from an overflow.