3 Shares Analysts Love: Barclays PLC, Prudential plc And Ashtead Group plc

Barclays PLC (LON:BARC), Prudential plc (LON:PRU) and Ashtead Group plc (LON:AHT) are all the rage with City experts.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

Professional analysts have more time, more data and better access to companies than most private investors. As such, the wisdom of the City crowd is worth paying attention to, because, ultimately, you’re either going with the pros or going against them when you invest.

Right now, Barclays (LSE: BARC) (NYSE: BCS.US), Prudential (LSE: PRU) (NYSE: PUK.US) and Ashtead (LSE: AHT) are among the darlings of the professional analysts.

Ashtead

Ashtead may be ranked at number 80 in the FTSE 100, but it’s top of the pops with analysts. The UK and US rental group, which supplies a comprehensive range of construction and industrial equipment, has been given a unanimous thumbs up by the City.

Ashtead reported what analysts at Panmure Gordon called “another sparkling update” for the third quarter earlier this month; and the company said it now anticipates full-year profit for it’s financial year ending 30 April to be ahead of previous expectations.

The shares are trading on 20 times forecast earnings, but the City experts are predicting strong growth to come: analysts at Jefferies, for example, believe Ashtead has the ability to double its share of a fragmented US market from 6% to 12% in four to six years — entirely “self-financed by robust cash flows”.

prudentialPrudential

Prudential may be the super-heavyweight insurer of the FTSE 100, but analysts at Killik & Co, in common with many City experts, reckon the company is “the best growth idea in UK insurance”. Barclays’ analysts go even further, describing Prudential as, “our top pick in European Insurance”.

The main reasons behind the bullishness are Prudential’s balance sheet strength, and the business positioning in its key geographies, particularly the US and Asia, which helped drive a 17% rise in annual operating profit, announced last week.

Most City experts reckon Prudential is good value for its premium 14 times current-year forecast earnings, including Goldman Sachs, which maintains the company as a “conviction buy”.

barclaysBarclays

Barclays’ annual results hardly set the world alight on 11 February, and the shares were down 8% by the end of the week. Costly legacy issues of PPI and other mis-selling, LIBOR and other benchmark-fixing, bonuses, and a poor performance from the investment bank, where a shake-up is now expected, all continue to weigh heavily on market sentiment.

As a result, the shares trade on just eight times current year forecast earnings, and at a 17% discount to tangible net asset value. The market’s pessimism is in direct opposition to almost universal City optimism. The balance of analysts rating the shares a buy is higher than at any time in the past 12 months.

On a sum-of-the-parts valuation, analysts at Espirito Santo reckon Barclays is on offer with the investment bank thrown in for free: “We estimate no value is being attributed to the investment bank. The investment bank contributes c.120p to our fair value of 356p, and excluding this gives you the current share price”.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

G A Chester does not own any shares mentioned in this article.

More on Investing Articles

Investing Articles

Could the JD Sports Fashion share price double in the next five years?

The JD Sports Fashion share price has nearly halved in the past five years. Our writer thinks a proven business…

Read more »

Bus waiting in front of the London Stock Exchange on a sunny day.
Investing Articles

If interest rate cuts are coming, I think these UK growth stocks could soar!

Falling interest could be great news for UK growth stocks, especially those that have been under the cosh recently. Paul…

Read more »

Investing Articles

Are these the best stocks to buy on the FTSE right now?

With the UK stock market on the way to hitting new highs, this Fool is considering which are the best…

Read more »

Petrochemical engineer working at night with digital tablet inside oil and gas refinery plant
Investing Articles

Can the Centrica dividend keep on growing?

Christopher Ruane considers some positive factors that might see continued growth in the Centrica dividend -- as well as some…

Read more »

Smiling family of four enjoying breakfast at sunrise while camping
Investing Articles

How I’d turn my £12,000 of savings into passive income of £1,275 a month

This Fool is considering a strategy that he believes can help him achieve a stable passive income stream with a…

Read more »

Person holding magnifying glass over important document, reading the small print
Investing Articles

2 top FTSE 250 investment trusts trading at attractive discounts!

This pair of discounted FTSE 250 trusts appear to be on sale right now. Here's why I'd scoop up their…

Read more »

Smiling young man sitting in cafe and checking messages, with his laptop in front of him.
Investing Articles

3 things that could push the Lloyds share price to 60p and beyond

The Lloyds share price has broken through 50p. Next step 60p? And then what? Here are some thoughts on what…

Read more »

Young female business analyst looking at a graph chart while working from home
Investing Articles

£1,000 in Rolls-Royce shares a year ago would be worth this much now

Rolls-Royce shares have posted one of the best stock market gains of the past 12 months. But what might the…

Read more »