openPR Logo
Press release

Dynamic Wealth Management Headlines

Investment Column: Johnson Matthey has formula for growth

Our view: Buy Share price: 2,016p (+78p) Johnson Matthey’s investors have become accustomed to the company making all the right noises when it updates the market. And yesterday it did not disappoint. The speciality chemicals operation, which refines platinum and is the world’s biggest maker of catalytic converters, has enjoyed a buoyant start to its financial year – sales (excluding precious metals) motored ahead by 12 per cent to £617m while underlying profit before tax jumped by 19 per cent to £98.2m. The group’s precious metal products division has been reaping the rewards unlocked by high metal prices. But it should be noted that demand for its products has also proved strong. Then there are those converters: the key environmental technologies division (which makes them) posted a 14 per cent rise in sales along with a “similar” improvement in operating profit. Light-duty catalysts had a tough time of it – no surprise given the disruption to the car industry caused by the unfortunate Japanese earthquake and tsunami. And not all metal price rises help the group, such as the rise in the cost of the rare earth resources used in the catalysts. But the shortfall was more than made up for by a rise in demand for heavy-duty diesel catalysts. What we particularly liked about yesterday’s statement was the group’s confidence that the first-quarter performance will continue through the rest of the year – and this has been a company that usually delivers on such predictions. Turning to the share price, we bought at 1,877p in November 2010, having been long-term supporters of the business, which has delivered for us. That said, the shares are no bargain – they trade at 14 times forecast full-year earnings, against a sector average of about 11 times. However, Johnson Matthey is well positioned in good markets and yesterday’s statement was notably more upbeat than some rivals’. It’s a tough call, but on balance, we’d keep buying. Headlam Our view: BuyShare price: 285p (+9.75p) Headlam, the European floor-covering distributor, has, like the retailer United Carpets, bucked the downturn in the carpet market by rolling out stellar figures for the first half of the year. While some, including the UK market leader, Carpetright, have struggled recently, Birmingham-based Headlam has powered ahead and delivered group revenues up by 5.5 per cent for the six months to 30 June. Analysts at Peel Hunt said the result was “excellent” in what the distributor’s management called a “flat” market, particularly in the UK, where its like-for-like sales surged by 7.4 per cent. While Headlam is benefiting from not having shops on the high street, the company deserves praise for maximising its relationships with retailers and contractors through the 47 brands it sells to them. That said, like-for-like sales on the Continent rose by a less stellar 4.5 per cent over the half-year. However, we note that analysts raised their profit forecasts after yesterday’s update and that the shares were as high as 354p as recently as January. It’s also worth noting that Headlam trades on what is a relatively modest forward-earnings multiple of 11.6 times. CranewareOur view: Buy Share price: 575p (+8.75p) Craneware is a bit of an oddity in that it is based up in Edinburgh but sells only to customers on the other side of the Atlantic. The company describes itself as the “market leader in automated revenue integrity solutions for the US healthcare market”. Translated, this means Craneware has developed systems to help hospitals to bill their customers more effectively. It said yesterday that revenue for the year to the end of June was expected to meet growth forecasts of 34 per cent to $28.4m. Adjusted profits are expected to come in at about $7.6m as management said its ClaimTrust acquisition had started to contribute. The group hailed the signing of two contracts to hospital groups this year, with the majority of the revenues recognised in future years. These helped to contribute to the company positively revising its revenue “visibility” for the next three years. Although it trades on a punchy valuation of 36 times forward earnings, falling to 25 on the estimates for next year, Craneware boasts an enviable momentum, which should underpin the share price.

At the Dynamic Wealth Management Zurich, Switzerland, we realize that no two clients are the same. Every client has different financial needs, goals, and plans. For this reason, the DWM offers a wide array of investment options to suit every client. We tailor your investment strategy to be as individual as you are.

11 Penn Plaza
5th Floor
New York City, New York 10001
United States

This release was published on openPR.

Permanent link to this press release:

Copy
Please set a link in the press area of your homepage to this press release on openPR. openPR disclaims liability for any content contained in this release.

You can edit or delete your press release Dynamic Wealth Management Headlines here

News-ID: 193344 • Views:

More Releases from Dynamic Wealth Management Zurich

Dynamic Wealth Management Headlines: Nigeria’s Economic growth and Statistics: …
Governor Sanusi Lamido Sanusi of the country’s apex Federal Reserve Institute, the Central Bank of Nigeria and its monetary policy committees retained the benchmark interest rate at 12 percent. The market did not anticipate any change of the monetary interest rate; therefore there was no negative or positive reaction to the outcome. Sanusi’s CBN cannot be accuse of not trying its best possible to utilize the tightening of the monetary
Dynamic Wealth Management Headlines: German Bunds Advance as French Borrowing Co …
German bonds rose as French borrowing costs climbed at an auction, stocks declined and European industrial orders increased less than analysts predicted, fueling concern the debt crisis is feeding an economic slump. Italian and Spanish bonds slid as Europe’s bailout fund sells notes at a yield spread almost seven times its first issue a year ago. Greek Prime Minister Lucas Papademos said his nation faces “the immediate risk” of a default
Dynamic Wealth Management Headlines: Europe,China Manufacturing Drops on Impact …
Dec. 1 (Bloomberg) — Manufacturing weakened from China to Europe last month as the euro region’s debt crisis darkened the outlook for the global economy. China’s manufacturing contracted in November for the first time since February 2009 as the property market cooled and Europe’s turmoil cut export demand. In Britain and the 17-nation euro area, manufacturing shrank at the fastest pace in about 2 1/2 years as the region edged toward
Dynamic Wealth Management Headlines: Opportunities for Africa from the global ec …
The recent global economic crisis has provided us in Africa with an opportunity to review how we do business and think about the future, a future that needs to be grounded in fairness, integrity and sustainable development as opposed to greed and cronyism that has all too often been the case in the past. I believe that a key factor for the future will be the role played by the

All 4 Releases