Here’s your latest round up of how the experts view key shares.
Travis Perkins, Ocado and Next are among the companies under the spotlight this week.
1. FirstGroup – BUY
Index: FTSE 250
FirstGroup’s trading update for the five months to the end of August was slightly better than expected, due to some recovery in activity and government support.
Liquidity remained unchanged at £850 million for three months, indicating that there is no cash burn, according to Alex Paterson, an analyst at Peel Hunt.
“The board is focused on executing the divestment of the North American businesses and is encouraged by significant interest from potential buyers,” he said.
2. Ocado Group – HOLD
Index: FTSE 100
Ocado delivered strong third quarter sales figures today and reported a positive start to its new M&S service, which launched at the beginning of September.
The figures also suggest the switch to online grocery deliveries during the lockdown has been sustained, according to Ian Forrest, investment research analyst at The Share Centre.
“We continue to recommend the shares as a ‘hold’ for investors seeking growth and willing to accept a medium to high level of risk,” he said.
3. Hilton Food – BUY
Index: FTSE 250
Hilton has performed well through the Covid period with additional volumes more than compensating for higher costs.
The company is moving forward strategically and has a new site in Belgium due to open in October, according to Charles Hall, an analyst at Peel Hunt.
“The dividend was increased by 16.7% demonstrating the recent performance and confidence in the outlook,” he said.
4. CRH – BUY
Index: FTSE 100
The building materials group, whose profitability is strongly linked to the global economy’s health, has a strong balance sheet and good cash generation.
Its share price has recovered on hopes governments will push for more infrastructure spend, according to Graham Spooner, investment research analyst at The Share Centre.
“A medium risk buy, but given the current uncertainty we would only suggest drip=feeding,” he said.
5. Focusrite – BUY
Index: FTSE AIM 100
It’s been a great end to an unprecedented year for the music and audio products group, with a better-than-expected revenue and cash position.
The performance was helped by the Covid-19 environment, with people staying indoors for entertainment, according to James Lockyer, an analyst at Peel Hunt.
“There are multiple exciting growth drivers for Focusrite, including non-music audio such as Podcasts, expanding through M&A, greater ownership of its end user, and enhancing its cash profile via entertainment software,” he said.
These recommendations were correct at the time of first publication but could change at any time. The information included in this article does not constitute regulated financial advice. You should seek out independent, professional financial advice before making any investment decision.
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