Shares in International Personal Finance (LSE: IPF) have fallen by as much as 10% today after the release of a first quarter trading update which showed its performance has been somewhat mixed.
On the one hand International Personal Finance has been able to grow customer numbers by 3% and increase proforma credit issued by 6% versus the first quarter of the prior year. However, it experienced a worse-than-expected performance in Mexico making its overall performance somewhat less impressive.
Looking ahead, International Personal Finance is forecast to record a fall in its bottom line of 3% this year, which has the potential to dampen investor sentiment in the short run. However, with growth in earnings of 14% expected next year, its shares could begin to rise over the medium term. And trading on a price-to-earnings-growth (PEG) ratio of just 0.6, International Personal Finance seems to have a wide enough margin of safety to merit investment right now.
New strategy
Also offering long-term growth potential is Standard Chartered (LSE: STAN). Like International Personal Finance, it’s enduring a challenging period at the moment as it seeks to implement a new strategy. That will see it boost the compliance function at the Asia-focused bank and also restructure to generate higher profits longer-term.
On the topic of profitability, Standard Chartered is forecast to more than double its pre-tax profit in 2017. This could improve investor sentiment in the stock and help to turn its share price around following the 10% fall since the turn of the year.
Looking further ahead, Standard Chartered continues to have excellent growth potential due mainly to its positioning within the lucrative Asian banking scene. With the middle class in China set to expand rapidly, demand for financial services is likely to rise and this could be the catalyst to push Standard Chartered’s share price higher in the coming years.
Lacklustre share price gains
Meanwhile, spread betting and CFD provider IG Index (LSE: IG) continues to post lacklustre share price gains, with its valuation having fallen 5% since the turn of the year. That’s despite an upbeat business performance, with the company reporting a rise in its bottom line in each of the last five years.
With IG forecast to continue that trend over the next two years, its shares could gain a boost from improving market sentiment. For example, IG is expected to increase its net profit by 6% this year and by a further 10% next year, which puts it on a PEG ratio of only 1.7. Alongside a yield of 4.4%, this shows IG has the potential to deliver an excellent total return in the long run. Therefore, it appears to be a sound buy at present.
