The post What’s In Store For Tesco Plc’s Future Earnings? appeared first on The Motley Fool UK.

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Mark Stones has no position in any shares mentioned. The Motley Fool UK owns shares of Tesco. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

The portfolio’s exposure to nascent businesses is expected to grow with time – a process that could take one to two years. According to Woodford, the capital available to these companies has been scarce, creating a “compelling investment opportunity”. Few investors, he claims, are willing to demonstrate the patience required for a great idea to become a commercial success.

Investors in the fund will avoid paying upfront fees, with a management fee awarded based solely on performance. This fee is payable in shares, aligning management’s interests with shareholders. Woodford is supported by a team of investment professionals, including Saku Saha and Paul Lamacraft, who have prior experience analysing smaller companies alongside Woodford.

Neil Woodford’s CF Woodford Equity Income Fund has returned 11.1% since it launched in June. The target of the new closed-end fund – meaning it will be traded on the stock market – is to return in excess of 10% annually over the longer term.

The post Neil Woodford Launching Woodford Patient Capital Trust plc, With Focus On FTSE 250 Companies appeared first on The Motley Fool UK.

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Mark Stones has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

I learned this at an earlier age when my mum unwrapped a DVD copy of Kill Bill. She feigned enthusiasm until the film concluded, before delivering the verdict “What a load of rubbish.” I probably should’ve bought a hair styler.

But if I were to gift someone shares this Christmas, the best question I could ask belies the usual logic. “Would I want to own this?” is the best question I could ask.

Unilever (LSE: ULVR) (NYSE: UL.US) is a company I’d be glad to consider as an investment, say, for a family member. It is a business that I’d likely be happy to buy and hold myself for 10 years or more. Its products such as Dove, Persil, Sure and Wall’s fulfil persistent needs to consumers around the globe. They are repeat purchases which become more valuable over time.

I’m encouraged by Unilever’s 15% operating margins – indicative that customers will pay a little extra for its brands. The company trades for around 16 times operating cash flow, and while this is not cheap, I’d hardly call it expensive for a company of Unilever’s quality.

I’m expecting Unilever’s margins to improve if, as expected, its brands continue to command higher prices in fast-growing markets such as India and Brazil. Unilever is a company that could underpin either a portfolio of your own or a family member’s for years to come.

The post If I Could Buy Just One Stock This Christmas, It’d Be Unilever plc appeared first on The Motley Fool UK.

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Mark Stones has no position in any shares mentioned. The Motley Fool UK owns shares of Unilever. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

The post Why ASOS Plc Is Still A Buy appeared first on The Motley Fool UK.

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Mark Stones has no position in any shares mentioned. The Motley Fool UK has recommended ASOS. The Motley Fool UK owns shares of ASOS. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

What: Shares of 4imprint (LSE: FOUR), the promotional products firm, rose by 11% to 767p in early trade after announcing third quarter revenue beat management’s expectations. Revenue was £66m (year-to-date: £182m), up 16% on the same period last year. The Direct Marketing business, which serves customers predominantly in North America, grew revenue by 27%.

So what: 4imprint said that growth was driven by “the rate of increase in marketing spend compared to last year”. Existing customers placed 25% more orders in the quarter, while orders from new customers also increased by 25%.

After today’s encouraging trading statement, the board expects it “will achieve a good result for the year as a whole”.

Now what: The board added that with effect from the FY2014 results announcement, 4imprint’s financial statements will be printed in US dollars. Future dividends will be determined in US dollars and paid in sterling at the exchange rate at the time the dividend is determined.

Prior to today, the City expected 4imprint to reveal a full year dividend of 18.6p per share. After this morning’s price movement the shares may offer a prospective income of 2.3%. Of course, the decision to ‘buy’ is entirely your own decision.

The post Why 4imprint Group plc Shares Jumped Today appeared first on The Motley Fool UK.

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Mark Stones has no position in any shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Petrofac

The firm has recently added to its portfolio of engineering and construction projects, with contract wins in Kuwait and Malaysia for $0.7bn and 0.5bn respectively. The ECOM division has already had its most successful year for new awards, taking $9.4bn orders year-to-date.

Shares of Petrofac climbed 4% to 1,030p in early trade, which reduces the loss the FTSE 100 member has made this year by a fifth to 16%.

The order backlog grew to $21.2bn in the three months ended 30 September, “giving good revenue visibility for the remainder of the year”.

Petrofac, which helps national oil companies rejuvenate mature oil fields, added “our focus remains on the delivery of key operational milestones” on its existing project portfolio. Petrofac only books revenue once these targets are hit.

Net debt stood at $1.1bn at the end of September, down from $1.3bn three months earlier.

Prior to today, the City expected Petrofac to revel earnings per share of 104p in its upcoming annual results, supporting a near-term P/E of 10.

The post Petrofac Limited Expects Up To $600m Profit In 2014 appeared first on The Motley Fool UK.

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BSkyB

The share price of Sky added 14p to 872p in early trade.

Sky grew customers by 760,000 across its paid-for subscription products, while average revenue per user (ARPU) ticked up £17 to reach £576.

In June the company agreed to buy Sky Italia and Sky Deutschland in a £7.4bn deal. The chief executive, Jeremy Darroch, said Sky is “making good progress” with the proposed transaction, which it expects to close in mid November.

The new ‘Sky Europe’ will have 20 million customers, up from around 11.5 million subscribers in the UK currently.

Sky also hailed the delivery of a “clear strategy for growth” in the existing business. After making investments in connected TV services, Sky saw the number of On Demand downloads more than treble to 257 million in the quarter.

Prior to today, the City expected Sky to deliver 2015 earnings of 63.7p per share and support a near-term P/E of 13.5.

The post British Sky Broadcasting Group plc Reports Q1 Profit Up 11% appeared first on The Motley Fool UK.

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The company added 10,000 new clients, which it said was a good result in light of “challenging investment conditions”. During the period the FTSE All-Share index fell by nearly 2%, meaning retail investors had less incentive to chase after potential stock market gains.

Geopolitical uncertainty and economic fears weighed on UK shares and investor confidence remains low. As a result, Hargreaves expects new business will be skewed to the second half of the year, with the end of the tax year acting as an incentive for clients to invest.

The chief executive, Ian Gorham, commented:

“As ever, future stock market levels and investor confidence will have a significant part to play during the remainder of our financial year. However, we remain confident of growing the business to the benefit of our clients and shareholders.”

Hargreaves was able to hold on to 92% of its clients during the period due to a strong emphasis on customer service. It added that it intends to develop a range of new cash-related services for clients.

The post Hargreaves Lansdown PLC Grows Assets To Record High appeared first on The Motley Fool UK.

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Leni Gas and Oil

The stock market hasn’t really kicked into gear in 2014. After a great year for shares in 2013, the benchmark FTSE All-Share index has posted a 4% decline since January.

Why, amid a comatose market, has this fledgling small cap rallied so strongly?

Risk factor

When you use your money to invest in shares of a business, the rate of return you can expect is made up of a few factors:

• Part of the rate of return is the time value of money. You’d rather have £100 now than if I promised to give you more than £100 in a year’s time.
• Part of the rate of return is compensation for the amount of risk you’re assuming.  In LGO’s case, will the company strike oil or not?

LGO has been drilling in Trinidad, which the company believes will create “medium and long term value” through increases in production over the next few years.

Upside potential

‘Great!’, you might think. We expect that demand for oil is going to increase over the coming years as developing economies continue to grow. Oil is a finite resource, of course, and the result should be that that prices trend upwards. ‘I need to get in on this oil mania!’

It’s not quite so simple.

Leni is embarking on a 30 well development project at the Goudron field in Trinidad. After successfully drilling the fifth well at the beginning of September, LGO moved its rig to another site and began preparing for production. So far, so good.

The problem is that we could yet see production delays or cost overruns. Given that the share price has risen six fold already, it’s difficult to assume that there’s much conservatism in the valuation at present. If there’s a stutter in executing on its projects then the market’s reaction could be fierce.

Where to look for small-cap bargains?

Investing in small-cap companies carries more risk than a ‘safe and steady’ blue-chip. People are lured by the potential for colossal gains, and investors in LGO need to familiarise themselves with the companies balance sheet. Drilling is expensive, and if there are cost overruns or delays, can it continue to fund its operations?

The post Why Leni Gas & Oil PLC Is Up 600% in 2014! appeared first on The Motley Fool UK.

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Mark Stones has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

During the financial crisis, shares of Barclays bottomed at 59p. The shares have risen nearly fourfold since then, but are still some way off their pre-crisis peak.

The performance of UK shares have been volatile in 2014 and Barclays has fallen 17% year to date. While a few companies have made big gains — the pharmaceutical sector has done well, along with consumer goods — the banking sector remains depressed.

Profits at Barclays are still dropping; the threat of litigation looms; and the market has very little faith in the prospective 4%+ dividend yield. Let’s look a little closer at what’s going on.

The core business

Despite strong performance from the retail, corporate banking and Barclaycard, pretax profit fell from £3.6bn to around £3.3bn in the first half of the year, which hasn’t inspired investors.

It’s sensible to invest in a wide range of companies, across a number of different sectors. That way, we spread our risk — and hopefully one or two shares will be big winners. If you’re thinking of investing in Barclays, you need to first familiarise yourself with what the bank does.

There is a cultural clean-up under way at Barclays, and the thrust of it seems to be to engender public trust after multiple mis-selling scandals and bonus backlashes.

Barclays’ customers want somewhere safe to store their savings, as well as access to loans and credit cards. It makes money on the difference between the interest on deposits and the returns from deploying that capital through loans and advances to lending customers.

A deathly overhang

Profits in the personal banking and corporate banking division grew by 23% in the first half of the year. The shares were weighed on, however, by weakness in the investment bank, where revenue fell 16%. This is becoming something of a theme at Barclays and the market fears something is seriously deficient there.

The market is likewise fearful of more big fines coming down the slipway which, if sizeable enough, could put excess strain on the bank’s capital adequacy, and a rights issue would be required to sure up its finances.

Barclays’ tangible assets are valued at around 315p per share versus a share price of only 234p. The prospective dividend yield, according to analyst forecasts, is 4%. It’s on a forward P/E of just 10. Those metrics would be appealing for any other share, but the problem is that Barclays is a bank, and fairly or not, it’s still seen as a falling knife.

Should you buy?

I’d advocate that ordinary investors should maintain a portfolio of between 10 and 20 companies. Stick with what you know. 

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