Woodford-backed stock takes double-digit dive

Woodford-backed stock takes double-digit dive

The swirl of bad news that has surrounded fund manager Neil Woodford for much of the past year took another turn this morning (26 February), as Provident Financial’s share price tumbled 12 per cent.

Mr Woodford has, along with fellow fund manager Mark Barnett, long championed the investment case for the doorstep and payday lender, despite the litany of woes that have befallen the company over the past 12 months.

Provident Financial's shares have slumped from £29.22 this time last year to the current price of £5.97 - a fall of nearly 80 per cent.

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Provident Financial is due to report its annual results on 27 February. Media reports over the weekend said large investors in the company have been approached to assess their appetite for a capital raising by the company.

As FTAdviser previously reported, the company issued a profit warning in August 2017, and in December the Financial Conduct Authority confirmed it is investigating Provident.

Provident was a top ten holding in Mr Woodford’s £7.1bn Equity Income fund at the end of 2017, but the most up-to-date figures from FE Analytics indicate this is no longer the case.

The shares are down 35 per cent in 2018 year to date.