Are Aviva plc, Coms plc And Imagination Technologies Group plc Capable Of 20%+ Returns?

Should you buy these 3 stocks right now? Aviva plc (LON: AV), Coms plc (LON: COMS) and Imagination Technologies Group plc (LON: IMG).

| 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.

Shares in smart building solutions provider Coms (LSE: COMS) have risen by over 10% today after it announced a contract win. Its core operating division, Redstone, has won a strategically significant contract to design and install an in-building cellular system in London. It will allow people to use their mobile phones and mobile-connected devices where signal strength could otherwise be an issue and is worth £0.75m.

The deal is the first in-building cellular contract of this scale in the UK and highlights Coms’ ability to cross-sell, with the client being an existing customer of the business. It also highlights the potential of the technology over the medium-to-long term, with Coms being well-placed to benefit from the continued requirement for faster download speeds and better reception across the UK’s main business areas.

5 Stocks For Trying To Build Wealth After 50

One notable billionaire made 99% of his current wealth after his 50th birthday. And here at The Motley Fool, we believe it is NEVER too late to start trying to build your fortune in the stock market. Our expert Motley Fool analyst team have shortlisted 5 companies that they believe could be a great fit for investors aged 50+ trying to build long-term, diversified portfolios.

Click here to claim your free copy now!

Although Coms remains a relatively high-risk play, it appears to be moving in the right direction. And with it having a net cash position and a new strategy, it could be worth buying for less risk-averse investors due to the potential for a further 20% upside.

Imagining a brighter future?

At the other end of the performance spectrum are shares in Imagination Technologies (LSE: IMG). They’ve fallen by 35% in the last six months following a profit warning, although investor sentiment is on the up. This is evidenced by their rise of 33% in the last month.

Looking ahead, Imagination Tech has considerable turnaround potential following its announcement that it expects to make a loss in the current financial year. It has already decided to dispose of its consumer electronics business, Pure, and will implement a major restructuring as it seeks to reduce operating costs by as much as £15m. And with a major review set to report later this year, its business model could rapidly change and improve, with a new strategy likely once a new permanent CEO is found.

With such major changes ongoing, Imagination Tech is a relatively risky buy at the moment. As such, and while it has a bright long-term future, it may be prudent to await more information regarding its turnaround plans before buying a slice of it.

Ready for take-off

Meanwhile, Aviva (LSE: AV) has the potential to deliver returns above and beyond 20% over the medium-to-long term. It continues to trade at a considerable discount to the wider index and while there’s a risk that its combination with Friends Life will be less successful than envisaged, the reality is that the merger is on track to deliver vast synergies and is set to create a dominant life insurance provider.

This doesn’t appear to be reflected in Aviva’s valuation, with the company’s shares trading on a price-to-earnings (P/E) ratio of 8.7. If they were to trade 20% higher, they would still have a rating of just 10.4, which indicates that there’s much more than 20% of capital gains in the pipeline for Aviva. And with the company’s shares having a yield of 5.6%, they offer excellent income prospects. This could be the catalyst to push them higher, as well as continued success with the recent merger.

Is this little-known company the next ‘Monster’ IPO?

Right now, this ‘screaming BUY’ stock is trading at a steep discount from its IPO price, but it looks like the sky is the limit in the years ahead.

Because this North American company is the clear leader in its field which is estimated to be worth US$261 BILLION by 2025.

The Motley Fool UK analyst team has just published a comprehensive report that shows you exactly why we believe it has so much upside potential.

But I warn you, you’ll need to act quickly, given how fast this ‘Monster IPO’ is already moving.

Click here to see how you can get a copy of this report for yourself today

Peter Stephens owns shares of Aviva. The Motley Fool UK owns shares of Imagination Technologies. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

Hand flipping wooden cubes for change wording" Panic " to " Calm".
Investing Articles

This cheap share fell 30% last week. I’d buy now

This huge US corporation saw its shares crash by 30% last week. But I'd buy this surprisingly cheap share now…

Read more »

Various denominations of notes in a pile
Investing Articles

These 7 shares produce passive income of 7% to 11% a year!

Passive income is extra money I make without working. By buying these seven shares, I could earn 8.9% a year…

Read more »

A person holding onto a fan of twenty pound notes
Investing Articles

6.6%+ dividend yields! 2 FTSE 100 dividend stocks to buy

Finding the best dividend stocks to buy requires extra care today as soaring inflation takes a bite out of shareholder…

Read more »

Arrow symbol glowing amid black arrow symbols on black background.
Investing Articles

At 85p, are Rolls-Royce shares a slam-dunk buy?

The Rolls-Royce share price is in penny stock territory. Roland Head explains why he thinks this FTSE 100 stalwart looks…

Read more »

Business development to success and FTSE 100 250 350 growth concept.
Investing Articles

‘Big Short’ investor Michael Burry is buying this quality growth stock! Should I?

In the first quarter, Michael Burry bought more of this growth stock. Is this a hint that I should also…

Read more »

A beach at sunset where there is an inscription on the sand "Breathe Deeeply".
Investing Articles

Stock market crash: here’s why falling prices is good news

Over in the US, a stock market crash is battering high-priced stocks. But I see falling shares as an opportunity…

Read more »

Hand flipping wooden cubes for change wording" Panic " to " Calm".
Investing Articles

These 5 FTSE 100 shares crashed in 2022. I’d buy 1 today

Although the FTSE 100 index is flat in 2022, some Footsie shares have crashed hard this year. But I see…

Read more »

Passive income text with pin graph chart on business table
Investing Articles

How investors can boost their passive income when the FTSE is falling

Stock markets are plagued with fears right now. Here's why I firmly believe those fears improve our passive income prospects.

Read more »