Shocking inflation

Headlines say UK inflation is a real shocker at highest rate since 1992 and all Stockomendation stock picks are a mix of 78% BUY, 13% HOLD and 9% SELL.

1. HOLD Asos

Top stock pick this week is HOLD ASOS by Deutsche Bank with a tip performance of 9%.

How the mighty online retailer has fallen. From humble 24p per share beginnings back in 2001 Asos share price rose to an all-time high of 7,530 in 2018 and is now at 397p, which if you bought at the beginning and held, would still be a win. However, as the average time an investor holds shares is 5.5 months, we don’t suppose many are reaping the still significant upside of a 22 year hold.

Asos shares are up 25% in one week – great. But they fell 46% on Monday, not so great. Looking at the history, Asos is a volatile stock beholden to the winds of inflation, cost of living, sentiment, and confidence. The opportunity now might be an acquisition from a foreign company given the weak pound, rather than recovery, given yesterday’s interest rate hike. The analyst reduced the target price from 725 to 485p

True to uncertain style, five out of five analysts in Stockomendation each give Asos a different rating: James Beard says BUY, Deutsche Bank HOLD, Edward Sheldon SPECULATIVE BUY, Sumayya Mansoor says WATCH and RBC says SECTOR PERFORM. Seems even the experts can’t agree on this one! There are currently 16 short positions open.

2. BUY Begbies Traynor

Second interesting stock pick this week is BUY Begbies Traynor Group by Royston Wild in The Motley Fool with a tip performance of 5%.

Begbies Traynor is a consultancy that specialises in insolvency and restructuring. Wild says it is the “ultimate safe haven share” with trade picking up as other trade… well… doesn’t.

Begbies Traynor share price floated at 47p in 2004 and has had a few ups and downs but has been climbing steadily lately to 134p.

It’s boom time for insolvency practices now as small businesses go under to be replaced by large global conglomerates – insolvencies topped pre-pandemic levels in Q4 2022 and the toxic set of risks just keeps on coming, to the delight of Begbies Traynor shareholders.

Two of two analysts in Stockomendation rate it as a BUY being Royston Wild and Canaccord Genuity and there are no active short positions open.

3. AVOID Concurrent Technologies

Third interesting stock pick this week is AVOID Concurrent Technologies by Steve Moore in ShareProphets with a tip performance of 4%.

Concurrent technologies is a computer systems manufacturer based in Essex. It floated at 18p in 1996 and today is at 66p. The graph is a nice and gentle upwards incline with not too many rollercoaster fluctuations.

The news is that they are delaying their annual announcement due to auditor delays, but it expects to report in line with forecast.

Steve Moore has a problem with their accounting methods and indeed I think I read another ShareProphets writer say ‘revenue is subjective,’ so whilst sentiment can guide (and fool), the way the numbers are counted, in some cases, matters very much. Steve states the audit delay announcement as possible cause for concern – if the way it is counted changes, what else changes. I suppose we will wait and see.

Two out of two Stockomendation analysts are appositely opposed in their views being BUY from John Cheong and AVOID from Steve Moore, and there are no active short positions open.

Forewarned is forearmed! As always you can see the aggregated, performance monitored and ranked stock tips and picks data in Stockomendation which equips you to make good investing decisions. Check out www.stockomendation.com before your next trade for maximum understanding of your target stock.

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Disclaimer: The contents of this article should not be considered financial advice. Pricing data correct as at 23th June 2023.