The Motley Fool

Should You Buy ARM Holdings plc, Bonmarche Holdings PLC And Henry Boot plc After Recent News Flow?

Shares in property company Henry Boot (LSE: BHY) are up by over 3% today after it released an encouraging trading update. For the 2015 full-year it expects pretax profit to be slightly ahead of previous guidance, with the sale of four strategic land sites as well as four completed development properties increasing its profitability in December.

Meanwhile, Henry Boot also received draft year-end property valuation data and has made provisions against certain investment sites where the anticipated schemes will not progress as had been anticipated. Still, the company’s long term future remains sound, with it on site with the residential development of the former Chocolate Factory in York, as well as making progress with its major development in Aberdeen.

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With Henry Boot due to report a rise in its earnings of just 5% this year, there appear to be a number of other property companies which offer better growth potential. Similarly, even though Henry Boot’s price to earnings (P/E) ratio of 12.1 is fairly low, other companies operating within the property space also offer superior value for money at the present time. As such, Henry Boot appears to be a stock to watch, rather than buy, at the present time.

Also reporting today is fashion retailer Bonmarche (LSE: BON), with its shares being up 4% at the time of writing. That’s despite its Christmas trading period being a rather disappointing one, with the company reporting a decline in like-for-like (LFL) sales of 2.7% for the five weeks to 26 December. This performance dragged down LFL sales for the quarter, with them dropping by 0.8% in the thirteen weeks to 26 December.

While negative sales growth is a cause for concern, Bonmarche has maintained its guidance for the full-year and expects pretax profit to be within the £10.5m to £12m range. And encouragingly for its investors, it states in today’s update that trading since Christmas has trended towards more normal levels.

Looking ahead, Bonmarche is forecast to post a rise in earnings of 10% in the next financial year and, with it having a price to earnings growth (PEG) ratio of 1.3, it appears to offer good value for money. Although its share price may be volatile, for less risk averse investors it could be a sound purchase for the long term.

While shares in ARM (LSE: ARM) have made a disappointing start to the year, the technology company’s recent update showed that it is making encouraging progress. For example, revenue increased by 17% in the third quarter of the year versus the same period last year, while earnings rose by 29% on a per share, normalised basis. And with ARM being expected to post a rise in its bottom line of 67% for the full-year, investor sentiment could pick up following its 10% decline since the turn of the year.

Although ARM currently yields just 1.1%, its shareholder payouts are increasing at a rapid rate. In fact, in 2016 they are set to be almost three times their 2011 level and, with ARM having significant long term earnings growth potential and a payout ratio of just 29%, it could quickly become a highly appealing income stock. As such, it appears to offer stunning long term total return prospects and seems to be a strong buy.

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