Will Santa gift investors?

Headlines this week debate whether Santa will gift investors with a stock market rally or not this December and top stock picks are a mix of BUY(72%), SELL(19%) and HOLDS(9%) this week at Stockomendation.

1. SELL Strix

Top performing share pick this week was SELL Strix Group (KETL) by Shore Capital with a stock pick performance of a mega 19% Shares fell off a cliff on 29 November to the lowest price ever today 80.08p for this kettle safety control company due to company forecast.

The Isle of Man company formed in 2017 issued a profit warning announcement on Tuesday stating that China lockdowns & economic uncertainty are leading to massively reduced forecasts for the year ahead. It stated £23m profit in 2022 considerably down from its £27m September forecast. 2 of its 5 largest customers are in China.

Strix has just purchased Billi Australia, New Zealand & UK for £38m. It already has 56% market share of the kettle controls market so this should expand that.

The drop is worrying but due to market share, growth & general stability analysts are mixed about whether Strix can make it through the tough times ahead but considering Shore Capital has had a SELL rating on it since 2020 top stock pickers might be steering clear for the mo.

2. BUY Horizonte Minerals

Second interesting top stock pick this week was BUY Horizonte Minerals (HZM) by Bank of America with a stock pick performance of 15%.

The Brazil nickel miner HQ’d in London has suffered mixed fortunes since listing at 850p in 2006. It now sits at a paltry 123p, but shares are slightly moving upwards since the announcement which we think would seem to have something to do with the Araguaia Strategic Minerals Project due to begin production in 2024. Nickel is the earth’s second most abundant element after iron but the Brazilian Government have classified the Araguaia project as a Strategic Minerals Project which means it will get priority as the Gov deems it to have strategic importance to Brazil.

Horizonte did an oversubscribed institutional only fundraise in September for £70.5m but investors were unfazed, and the share price dropped right after it.

The big news could be that Horizonte has awarded 2 port contracts this week, a key condition required for draw down of the debt funding package.

As with most companies the Horizonte story is more complex once you get into it and as with all mining companies’ exploration is expensive, there are many unknowns regarding the extraction and may fail: it’s a high-risk, high-reward open cut mine out there and the metal proof will be in the refined pudding only once it’s extracted!

3. SELL eEnergy Group

Last but not least in the top 3 interesting stock picks of the week we have SELL eEnergy Group (EAAS) by none other than Tom Winnifrith in ShareProphets with a stock pick performance of 8%.

Fortunes couldn’t get sadder for this net zero consultancy since it listed in 2005 at an all-time high of a whopping 10,350p to today where it now sits at a meagre 4.50p

Tom in his signature style makes no bones about this being a fantastic possible short position (check out Stockomendation’s new feature!).

Apparently after a series of blunders and losses and bad decisions eEnergy has now borrowed expensive debt. With a net loss of £1.6m Tom is… erm.. shall we say highly critical of the firm’s future as a going concern. You can read his entertaining and informing article here which might tell you all you need to know not only about stock journalism but eEnergy’s likely future.

The path to net zero takes a village but looks like eEnergy might be sporting a DNR in the short term.

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Disclaimer: The contents of this article should not be considered financial advice. Pricing data correct as at 1st December 2022.