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“Investors appear to be regaining confidence after a volatile period last week with markets marching forward across the UK, mainland Europe and Asia on Monday morning. The FTSE 100 climbed 0.4% to 7,042 while the FTSE 250 advanced 0.3% to 18,647. “Oil prices continued to recover from recent weakness, putting a shine on natural resources stocks. UK banks were also in focus with notable gains from Lloyds (+1.8%) and Barclays (+1.4%). “Key announcements to watch this week include easyJet’s full-year results on Tuesday and first-half results from support services firm Babcock on Wednesday. “Babcock has come under attack from mystery investment group Boatman and faced questions over the strength of its relationship with the Ministry of Defence, at a time when then MoD remains tight for cash and outsourcing is under the microscope,” says Russ Mould, Investment Director at AJ Bell.
Diploma
“Many people following stock markets focus their attention on companies either trying to dominate the world, develop innovative new technology, or discover the next big miracle drug or large oil field.
“In doing so, they often miss less-glamorous companies which may actually be better investments over the long term. Diploma arguably fits the bill as a distributor of products that helps many industries do their day job.
“It provides technical products like hydraulic seals for heavy industrial equipment, wiring and connectors for aerospace and rail industries, and clinical diagnostic kit for hospitals.
“That may sound boring, yet Diploma’s full-year results show yet another year of growth in revenue, pre-tax profit and dividends.
“It has delivered 1090% total return for shareholders over the past decade, which is the rise in its share price and all dividends reinvested. That is seven times greater than the 156% total return from the FTSE 100 index over the same period. As such, boring is certainly beautiful when it comes to Diploma.
“Particularly reassuring from the latest results is the fact that senior management issues do not appear to have disrupted the business. Diploma is currently without a chief executive after the previous boss, Richard Ingram, left in August after less than four months in the job.”
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