Today I am looking at three Footsie stocks making the financial pages on Wednesday.
Property powerhouse
Shares in Zoopla Property Group (LSE: ZPLA) have galloped 9% higher in midweek business to reach fresh record highs above 300p.
The company saw revenues surge 130% between October and March, to £96.4m, it announced today, a result that propelled pre-tax profit 53% higher to £28.1m. Zoopla now expects full-year profits “to be at the top end of market expectations” of £56m-£71m, it added.
Zoopla’s stock price has gained close to 50% during the past three months alone. And at face value, price-to-earnings (P/E) ratings of 27.1 times and 22.7 times for the years to September 2016 and 2017, respectively, may suggest the share may struggle to gain further traction.
However, Price/Earnings to Growth (PEG) ratings around the bargain benchmark of 1 through to the close of 2017 suggest that Zoopla remains cheap relative to its earnings prospects.
The City expects the property play to chalk up earnings growth of 31% in 2016 and 21% in 2017. And with house-buyer demand set to keep climbing, I believe Zoopla is one of the hottest growth selections out there.
Safe as houses
Investor appetite for Paysafe Group (LSE: PAYS) has also taken off in midweek trade following more perky financial news, with the stock last seen 7% higher on the day.
Paysafe advised that “the positive momentum from 2015 has continued throughout the period to date,” with strong trading during January-April prompting it to hike its full-year sales forecasts.
The top line is now expected to clock in at $950m-$970m this year, Paysafe reckons, smashing current consensus around $911m. And adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) is predicted to range between $270m and $276m versus market consensus of $260m.
The online payment specialist was already expected to produce earnings of 37 US cents per share in 2016, according to City forecasts, shooting up from 2 cents last year and creating a brilliant P/E rating of 15.2 times.
And predictions of a further 16% bottom-line rise next week pushes the multiple to a mere 12.8 times. Given Paysafe’s stunning momentum, I reckon the firm could prove a canny growth purchase at current prices.
Testing treat
Product tester Intertek Group (LSE: ITRK) has not fared so well on Wednesday, however, and its share price was recently 4% lower from Tuesday’s close.
Intertek saw revenues sprint 12.7% higher during January-April, to £774m, it announced today, with a spate of acquisitions during the past year helping to deliver robust sales growth. And the firm added that “we continue to expect to deliver solid organic growth performance in 2016.” Organic sales rose 2.3% in the first four months of 2016.
Intertek has seen its share price balloon 7% during the past three months, suggesting that today’s price action is nothing more than profit taking.
Predicted earnings rises of 9% in 2016 and 6% in 2017 result in elevated P/E ratings of 21.4 times and 20.1 times respectively, suggesting that Intertek’s stock may struggle to gain traction in the near-term.
Still, I believe the company’s ability to outperform the wider market — helped by its wide diversification across industry segments — makes the business a strong contender for those seeking sustained earnings expansion.
