From today, Monday 5th August AIM shares can be put into ISAs

From today, Monday 5th August AIM shares can be put into ISAs- which is a tax-free allowance of £11,280 per year.

Try www.tradersown.co.uk

Shares can be bought and sold from as little as £8 a trade.

It is an informative share trading website.

Last week …

was positive with the FTSE 100 up 1.4% to 6648, the FTSE250 increasing 2.8% and the AIM All Share 723  improving 0.7%. Despite, US employment growing slightly slower than hoped confidence in the UK & US recovery is growing. This is being helped by the maintenance of monetary policy with low interest rates and continued QE. If played right the BOE and the US Fed can seamlessly ‘taper’ policy without any volatility.   What could go wrong ……..?

This week …

before Wednesday BOE’s Inflation Report, the new governor, Mark Carney, will have considered Monday’s Composite PMI, an indicator of growth from key sectors, as well as Industrial Production, on Tuesday.  A relative decline in the inflation outlook, offset by a relative increase in production would indicate that the UK is on track. China’s pursuit of a prudent monetary policy will have a reality check when Trade is reported on Wednesday, CPI Inflation, Industrial Production on Friday. Markets are likely to improve marginally this week.

 

Company Reports

Creston (CRE) – £64m@104p

Increasing Spin

The 1st Qtr statement to April reported earnings 5% lower than the previous year due to the loss of a healthcare client. The industry recently reported a 2.4% growth in UK Advertising spending and so is Creston’s so while new business wins are ahead the revenue is lagging. The company’s share buy-back programme recently continued with shares being brought at 103.5p which is at an historic P/E is 7.1x. Creston the formerly acquisitive marketing services businesses providing advertising, brand consultancy, CRM, digital and direct marketing, health communications, local marketing, market research, PR and social media marketing. New and additional business such as for Reckitts and Bentley will produce revenue in the second half. While digital work for J Sainsbury will be increasingly evident. The cautious board are however confident that they are on course to meet the current full year profits expectations of a  PBT of £10m on turnover of £78m which gives an EPS of 12.1p so a prospective P/E of 8.6x while yielding 3.6%.

Financials

There was net cash of £11.1m which should allowing room for selective acquisition although the current rating would tend reduce the number of opportunities. 

 

Newmark Security (NWT) – £7m@1.55p

Corporate Help 

As indicated by June’s Trading Statement the finals for the April year-end were encouraging particularly in its asset protection division. Turnover, helped by some one-off equipment sales improved 40% to £18.3m with gross margin maintained at just over 40%. Operating profits before £1.8m of exceptional write down of intangible assets and legal fees were up 7% to £202k with EPS down to 0.03p from 0.04p. Listed on Aim in 1997 to provide electronic and physical security systems focus on personal security and the safety of assets contracts can be relatively large but the timing of  delivery is dependent on customer requirements so turnover can very significantly year-to-year. The number of violent attacks on members of staff in banks and building societies as well as petrol stations and forex traders with open counters should result in increased orders for Newmarks ever increasing range of counter security products. The fall in turnover anticipated for the year to April 2014 is likely to leave the company marginally profitable. A corporate initiative seems to be required.

Financials

Cash inflow from operating increased 33% to £3m with net cash of £0.9m the NAV is £10m.

 

Filtronic  (FTC) – £59.8m@61.5p

4Gs Sake

Strong growth in the sales of wireless technology more than offset a decline in sales of older broadband products enabling Filtronic to quadruple its profit in the year to May 2013. The main market driver is the growth in smartphone numbers and the subsequent increases in data volumes. Filtronic supplies technology for the base stations and smart antennas required for the mobile services. Wireless revenues were 143% higher at £31.9m, while broadband revenues dipped from £13m to £8.13m. Pre-amortisation profit improved from £784k to £3.05m. The main profit improvement this year should come from a sharp fall in the loss in the broadband division. Filtroinc have the existing client base and are well positioned for the huge opportunities that exist for the provision of LTE/4G services. R&D costs of £5.4m, representing 13.5% on turnover was expensed  so not capitalized on the balance sheet. Profits for May 2014 year /end are forecast at £5.5m for an EPS of  4.78p a share, which puts the shares on a prospective P/E of 13x.

Finance

Cash flow is tight with debtors of £17m, although net cash was £1.9m at the end of May 2013.

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