MARKET COMMENT
Shares For A Bull Run

By Maynard Paton (TMFMayn)
September 17, 2004

With the emergence of a new bull market, growth shares are coming back into fashion.

As noted before, tomorrow's bull market leaders will be small, fast-growing companies that are too young and too obscure to have upset the crowd during the previous market downturn. With no history of disappointment to hold them back, investors will soon appreciate these new stock market 'stories', especially if a castle in the air can be constructed.

This time last year, three 'shares for a bull run' were highlighted. The table summarises their subsequent performance:

Average gain? A mega 47%!

Now tempted to look for tomorrow's bull market leaders? Here are three more young companies that fit the bill:

Atlantic Global (LSE: ATL) calls itself a 'specialist provider of integrated business and resource software applications'. It floated in 2001 at 25p a share and at today's 50p is valued at £10m. The last set of accounts showed earnings up 47% and the dividend lifted by 40%. An update in July signalled a 'strong' sales pipeline, profits running in line with expectations and over £2m in net cash. Annual earnings growth of 28% and 43% are expected this year and next. Interim results are due on Tuesday. Read more.

PlusNet (LSE: PNT) is an Internet service provider. The shares have added 15p since their 90p market debut in July, valuing the group at about £30m. The first six months of 2004 witnessed subscriber numbers up 33%, sales up 66% and earnings up 28%. PlusNet also carried £3m in net cash and said the 'rapid' increase in broadband users should produce 'further progress in profitability'. Brokers believe full-year earnings will improve 31% and jump 54% in 2005. Read more.

Synergy Healthcare (LSE: SYR) is a leading provider of healthcare services. It acquired a listing in 2001 and, after seeing its shares rally 150% to 328p, sports a market value of £120m. The most recent annual figures reported sales up 20%, earnings up 60%, a dividend up 31% and net cash of £4m. In June, Synergy raised £38m to buy a Dutch linencare firm and one month later confirmed trading in the current year had 'started well'. The City predicts earnings will grow by 25% this year and 23% next. Read more.

Summary

All in all, Atlantic, PlusNet and Synergy exhibit similar characteristics to last year's trio. No guarantees of course, but another 47% twelve-month gain would be very welcome!

Impressed by the 47% gain? Check out the Motley Fool's Value Investor newsletter, in which Maynard reveals his best share tips. To enjoy a FREE 30-day no-obligation trial of the newsletter and access to past editions, click here.