Private Credit Boom

Private credit boom and all stock picks are a mix of 77% BUY, 11% SELL and 12% HOLD this week.

1. SELL Sondrel

Top stock pick this week is SELL Sondrel by Steve Moore in ShareProphets with a tip performance of 14%.

Sondrel is a chip designer offering consulting services to technology companies based in Reading with offices in China and other countries.

Sondrel share price launched at 58p in 2022, fell off a cliff in 2023 and is today at 9p.

Steve Moore in his article refers to this New Contract Win and Corporate Update RNS announcing a new £23m video streaming contract win with scepticism. Moore questions the positivity of the release when chip production on the new contract is not due to start until 2026, and cash flow woes today leave the company “financially distressed.”

In Stockomendation Moore is the only analyst with SELL and there are no active short positions.

2. BUY Barclays

Second stock pick this week is BUY Barclays by UBS with a tip performance of 4%.

Barclays is an English bank that was founded in Lombard Street, London in 1690 and is the UK’s 20th largest company by market cap.

Barclays share price launched on LSE at 435p in 2004, reached an all-time high of 666p in 2007 and is today at 163p. The bank is also listed on the New York Stock Exchange.

In the news this week for an 11.5% share price rise due to restructuring, earnings, and share buybacks announcements, full year results earnings were as expected except pre-tax profits which were down.

The bank is restructuring from 2 current divisions local and international to five in an effort to save headcount cost, the new divisions are: UK Consumer, US Consumer, UK Corporate, Investment, and Private & Wealth. Barclays has also instituted a shareholder buyback programme which will ostensibly provide a £10bn return to shareholders over 3 years.

In Stockomendation five out of five analysts say BUY in some form or other with Alan Oscroft, UBS and Berenberg with BUY, RBC Capital with OUTPERFORM and JP Morgan with OVERWEIGHT. There is currently one active short position open, view that here.

3. BUY Just Eat

Third interesting stock pick this week is BUY Just Eat Takeaway by Shore Capital with a tip performance of 3%

Just Eat is a food takeaway delivery service founded in 2001 in Denmark, now offering home delivered food in 7 countries.

Just eat share price launched on LSE at 7,740p in 2020, reached an all-time high of 9,980p in 2020 and is today at 1,298p.

Just Eat announced its final year results this week in this RNS forecasting a 40% profit jump but shares fell 6% due the current share buyback programme expiring which caused the CEO to say he would see whether another one will be available.

The company also said it expects its gross transaction value to grow by 2% to 6% this year excluding the US.

In Stockomendation four analysts with four different opinions they are Shore Capital with BUY, Chris Bailey saying AVOID, JP Morgan NEUTRAL and Barclays with EQUAL WEIGHT. There are no active short positions open.

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Disclaimer: The contents of this article should not be considered financial advice. Pricing data correct as at 29th February 2024.