Share tips of the week – July 8

three to buy

berkeley group

The Telegraph

Investors and experts expect a collapse of the housing market after an explosive growth in prices of 22% in the last two years. As a result, shares of the London-focused Berkeley Group, which offers 10% of London’s new private and affordable housing, have fallen 22% since January. But the “serious imbalance” between supply and demand remains, and will only widen as the population grows. Even if house prices fall, Berkeley “is in a great position to survive” with net cash of £269m. It is a consistent performer and plans to return £282m annually to investors via dividends over the next three financial years. Those who can withstand short-term volatility should buy now for high returns later. 3,743p

Forterra

The times

Brickmaker Forterra benefited from a prolonged shortage of brick production capacity following the 2008 financial crisis. This has insulated it from the current economic crisis, allowing it to pass on price increases to offset inflation. These should also be enough to return margins to pre-pandemic records; this year’s gains should easily eclipse their 2019 level. A drop in house prices is a risk to demand for bricks, but tight supply provides protection. 262p

inch rope

Sunday’s mail

The Inchcape car dealership group says profits should hit £370m this year, “considerably higher” than the £300m initially forecast, thanks to record sales. The company operates just over 100 dealerships in the UK, but most of its money is raised abroad. It offers an easy and cost-effective way for consumers to buy cars and has developed good relationships with car manufacturers. He has also invested in his website. The next step is to acquire smaller dealers and expand into used cars. 691p

three to sell

Liontrust Asset Management

The times

Shares of Liontrust Asset Management have fallen more than 50% since January. While many other companies face falling profits, “previously high expectations mean investors have singled out the manager for punishment.” During the 18 months to the end of December, assets under management had almost doubled to £37.2bn, but economic disruptions due to the war in Ukraine saw assets shrink for the first time in two years during the first quarter. of 2022. 432 million compared to net inflows of £1 billion the previous year, coupled with a market slump, caused further pain. The group also markets itself as a specialist in environmental, social and governance (ESG) strategies, which have been overshadowed as energy and mining groups have exploded. A beefy dividend is a consolation, but the next two years will be tough. Avoid. 890p

naked wines

Investor Chronicle

Investors in Naked Wines were left “looking for the nearest bottle of wine” after the online wine retailer’s latest results. It returned to profit, with sales up 5% in the year to April 2022. But the market was spooked by the company’s prospects: the sales forecast for this year has been lowered and the group’s key performance indicators were “less than impressive”. . The five-year expected return on investment in customer acquisition declined and investment in new customers fell by nearly a fifth to £41m, which will not help stimulate demand. A buildup of inventory and a new line of credit add to the risks. Sell. 171p

…and the rest

Investor Chronicle

Gold is a classic inflation hedge and the current economic uncertainty could continue to push its price higher. the Invesco physical gold, etc. provides a “simple and inexpensive way” to gain exposure to gold (144p).

share

“There is merit in looking for less obvious bargains,” and AVI Global Trust, which invests in family-controlled funds and Japanese stocks that stand to benefit from better corporate governance, “looks like an excellent vehicle to do so.” To buy (180p). Record provides foreign exchange hedging services for institutional investors. It has an ambitious growth plan, which if achieved would mean that current analyst forecasts are “too low”. To buy (74p).

sunday times

needle health owns 39 private UK hospitals, which have benefited from record waiting lists at NHS facilities. It is also capitalizing on increased outsourcing by the NHS, which began using its services during the pandemic. Stocks seem to have more to run. To buy (235p).

The times

industry group from Essentra shares have fallen 50% in five years. Management is focusing on the fastest growing components business and leaving the packaging division. “More Disposals
make stocks look too cheap.” To buy (248p).

The daily telegraph

airlines IAG Y easyjet “continue to face the endemic problems of its sector”. But external challenges are likely to be temporary and this turmoil may prove to be a good entry point for investors. Both airlines also have the resources to withstand additional losses. To buy (116p, 403p).

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