Avoid Pessimism

Headlines say Avoid Pessimism and UK inflation has dropped for the second month in a row. Top stock picks are a mix of Hold and Buy this week with all Stockomendation picks 73% BUY, 15% HOLD and 12% SELL.

1. HOLD Marstons

Top interesting stock pick this week is HOLD Marston's by Deutsche Bank with a tip performance of 6%.

Hope springs eternal for shareholders of this pub chain or at least it might have done when they rejected offers of 105p in a takeover bid by a US company recently.

Based in the Midlands with 1,500 properties under its belt, beleaguered comes to mind if we look at the max chart… after listing at 106p in 1993, Marstons reached the dizzy heights of 330p in 2007 and has since made its way down to 41p where it is today, a fair sight from the 105p it deemed as “significantly undervalued.”

Hospitality stocks are in a great freeze of their own at the moment – taking one look at the main media themes on repeat tells us why – but this stock pick is a HOLD. What went right with this pick?

Surprisingly Deutsche Bank has had a HOLD rating on Marstons since the old days of 2017. Shore Capital has placed a BUY rating on it. It’s true that Marstons value also lies in its property assets but for recovery dreams to come true it might need to to do a Great Turnaround.

We’re sure the forthcoming AGM on 24 January will be a perky affair. Maybe the banks know something we don’t in their optimism? We wait to hear.

2. BUY Kenmare Resources

Second interesting stock pick this week was BUY Kenmare Resources by Berenberg with a stock pick performance of 6%.

Kenmare Resources is an Irish mining company whose main asset is a titanium mine in Mozambique, “Moma.” On the 18th it reported greater shipments in 2022 – $110m greater in fact – and higher demand due to the end of COVID with China recovering. Titanium is extremely strong and lightweight. It delivers the same strength as steel at about 40% of the weight, with applications in defence and aerospace. China consumes the most titanium ore and is the world’s largest manufacturer of titanium dioxide. China imports titanium from 29 countries and Mozambique is China’s number 1 source. It is also used as a whitening agent in paints.

£3,190 was Kenmare’s opening price back in the heady days of 1993 and wow what a ride to 459p where it is today. It’s been to £23,300 price per share in in 2007 down to £3,000 and back up to £21,560 in 2012. One could get vertigo just looking at the chart.

Anyway. Berenberg has had a BUY rating on this stock since 2018 (when the price flattened out after all the ups and downs). In this most recent rating Berenberg raised its price target from 710 to 780p. As we all know mining is a risky bet but if the Board’s promises come true this one might pay off.

3. BUY Experian

Number 3 and 4 interesting stock picks this week was BUY Experian by Goldman Sachs and Shore Capital with stock pick performance of 4%.

The only stock this week that’s price is higher than when it listed. Hooray! Maybe that’s saying something; maybe not but analysts are perky about the credit reporting company.

Earnings fell a full 41% in the first half of 2022, but the Board left their forecasts as they were. Profits were down 21%. Reduced spending affects Experian but its data is valuable and so it’s 7-9% growth predictions could come true.

Barclays, JP Morgan have an OVERWEIGHT rating, Citigroup is NEUTRAL and Royal Bank of Canada says UNDERPERFORM which was a downgrade. Simply Wall Street says 3/7 analysts are BUY with the other 4/7 say HOLD. In Stockomendation we see 23 BUY ratings and 2 HOLDs.

Image credit: Botmultichill via Wikimedia Commons - Titanium crystals

UK Fund Manager Short Positions
See which UK Fund Managers are betting against your investments by accessing current & historical short positions on UK companies showing you which fund manager has shorted which company and by how much.

Join Now

CASH PRIZES ARE BACK!
Think you can pick stocks? Play the January league UK Share Picking game FREE for your chance to win cash prices : uksharepickinggame.co.uk

Disclaimer: The contents of this article should not be considered financial advice. Pricing data correct as at 19th January 2023.