Why it is worth getting excited about these stock market stars
Its easy to get sucked into the noise about uncertainty in the UK created by Brexit and the impact this is having on the markets.
This is clearly a live issue, and no-one would deny it is having a tangible impact on market and business confidence. However, there are still lots of excellent and thriving companies listed in London.
The upcoming FTSE reshuffle, when stocks are promoted to or relegated from indices like the FTSE 100 and FTSE 250, will shine a light on some of these UK plc success stories. It is also a reminder there are some genuinely good quality growth companies out there if you know where to look for them.
Two names who are likely to be knocking on the door of the mid cap FTSE 250 index, with the qualifying mark currently on track to come in around £600m when the changes are made in mid-June, will be no strangers to regular readers of Shares.
Though it is listed in the UK 4imprint (FOUR) is really a US business in terms of its operations. A current constituent of the Great Ideas portfolio, it is up 36% since we flagged its appeal in February.
The promotional products firm has been investing in its own marketing and this appears to be helping grab a larger share of an addressable market which is estimated to be worth $23bn across the Atlantic.
ENTERING THE STRATOSPHERE
Publishing firm Future (FUTR) has enjoyed an even more stratospheric rise in share price terms. We included Future in our list of top investment ideas for 2018. At that point the shares were trading at less than 400p and today they are around the £11 mark, valuing the company at close to £1bn.
Under chief executive Zillah Byng-Thorne, Future has demonstrated its ability to acquire and bring new titles into its transferable platform. This makes money out of content through e-commerce, licensing and digital advertising.
The company also resumed dividend payments in 2018, while making its largest acquisition to date in US firm Purch for £101m.
On 17 May it announced a record-breaking first half performance with underlying earnings almost trebling to £23.7m and lifted its guidance for the full year.
We will likely provide an updated view on the investment case in a more in-depth article on the business in an upcoming issue of Shares.
Another name which featured in our list of tips for 2018 was automotive testing firm AB Dynamics (ABDP:AIM). As an AIM-quoted company it wouldn’t qualify for the FTSE 250 but if it were to make the move to the Main Market, it wouldn’t be far away.
AB Dynamics has positioned itself to benefit from the big transition car makers are going through at present. Strong growth in revenue and profit has been rewarded by near doubling in the share price year-to-date to £26.85.
To put that into context when we first highlighted the stock in the magazine in October 2013 it was trading at just 134p.