Homeserve (HSV) £12.75

Gain to date: 11.4%

Original entry price: Buy at £11.45, 16 April 2020

Home repairs services provider Homeserve (HSV) continues to demonstrate the resilience which made us flag its appeal back in April.

Supported by a typically solid set of full year results and accompanying hike in its dividend (19 May) the share price has continued to rise on a steady upwards trajectory and the company recently joined the ranks of the FTSE 100.

An expected trading update alongside the company’s AGM on 17 July looks to be the next catalyst.

Homeserve’s recurring membership model, covering its customers in the event of mishaps with their gas, electricity or plumbing, means it has been broadly unaffected by the coronavirus crisis.

For the 12 months to 31 March the company posted a 15% rise in adjusted operating profit to £202m and a 10% rise in the dividend to 23.6p.

A company sponsored survey in April showed that over a third of customers considered the Homeserve service more important to them compared with March.

April to September is usually a quieter period for marketing, so the company has paused most of its large-scale campaigns, which will slow future growth but also save money.

The board has conducted a viability assessment over a three-year period to 31 March 2023 and concluded that no single scenario stress test would impact the viability of the group.

SHARES SAYS: Keep buying.

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