viewKier Group PLC

Kier Group is now the most shorted stock in London

According to regulatory filings, there are six funds and asset managers betting heavily that the contractor's share price will continue to fall

In total, just under 11% of Kier’s shares are out on loan

Kier Group PLC (LON:KIE) is now the most shorted stock on London’s stock market after six hedge funds upped their bets against the troubled contractor.

Regulatory filings show that BlackRock, the world’s largest asset manager, and Marshall Wallace, the fund set up by the dad of Mumford & Sons’ guitarist Winston Marshall, have both increased their short positions in recent weeks.

READ: Kier gives short-sellers a boost as latest profit warning sends shares crashing

In total, the funds, which also include Kuvari Partners and TT International, now hold a combined 10.9% of Kier’s stock, up from just over 4% in May.

By ‘being short’, it means they stand to profit should the share price fall.

Kier, which is working on the heavily-delayed Crossrail and Facebook’s new London HQ, has endured an awful run so far in 2019, with the shares down more than 80%.

They currently trade at 75p, but less than a year ago the stock was trading hands for more than a tenner.

The plunge has come on the back of a string of profit warnings, with the latest one arriving last month, after which bosses said they would cut 1,200 jobs as part of plans to simplify the business.

Pitiful margins

Contractors have been under the spotlight of late, with the focus intensifying following Carillion’s shock collapse 18 months ago.

Kier was forced to beef up its balance sheet through a £264mln rights issue in November to help it avoid meeting a similar fate.

Those operating in the sector have had to cope with stringent public and private sector budgets which has pressured margins.

That means there is little margin for error should a project overrun or costs come in above the initial estimates.

Kier shares were up 5.3% to 76.8p on Tuesday morning, having dropped more than 12% on Monday.

Quick facts: Kier Group PLC

Price: 149.5 GBX

Market: LSE
Market Cap: £242.36 m

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