I’ve been scanning the FTSE 250 for top stocks that look set to thrill the market in 2025 and one immediately jumped out at me.

This is ironic because it’s one that’s flown completely under my radar for years, and with good reason. This company has got itself in a right lather.

When I see the name PZ Cussons (LSE: PZC.L), I immediately picture a bar of Imperial Leather soap. It used to be ubiquitous in people’s bathrooms, although I don’t recall seeing it as often lately.

Can theshare price shine again?

The consumer goods group has other brands, notably Original Source, Carex hand gels and the St Tropez self-tanning product range. It’s a decent collection but let’s put it this way: it isn’t Unilever. On the other hand, this could work in its favour. There’s more scope to grow a £375m company, which is PZ Cussons’ current market cap, than one worth £113bn.

So what went wrong? PZ Cussons operates in a competitive market, where it has been crowded out by big guns Unilever and Proctor & Gamble, while own-brand rivals and discounters squeeze margins and market share.

It also ended up with outsized exposure to the Nigerian market, which makes up around 40% of total sales. The 10.6% drop in full-year revenues to £527.9m was mostly driven by a plunge in the Nigerian naira.

The PZ Cussons share price has suddenly got some lustre after rising 14.1% in a month, driven by a positive market update on 21 November. It’s still down 39.68% over the last year though. Over two years it’s plunged 58.62%.

The board now predicts first-half like-for-like revenue growth of 5%, despite a sales dip in Asia-Pacific and some “category softness” in Australia and New Zealand. It’s plotting the partial or even full sale of its African business. That’s a big step. It’s operated on the continent for 140 years.

Long-running restructuring process

PZ Cussons is also making progress with the St Tropez sale, deemed a non-core brand. Popular in the US, it could raise anything up to £100m. The cash will come in handy. The company ended 2023 with a £250m debt pile. It’s worked that down to £160m. Selling the brand could be a game-changer.

The five analysts tracking the stock have set a median one-year share price target of 105.4p. That’s up 17.83% from today, if it happens. Three name it a Strong Buy, while two label it a Hold. None suggest selling, and why should they, with PZ Cussons shares finally showing signs of life.

My concern is that the restructuring process has been rumbling along for years, with the board offloading everything from its Nigerian dairy brand to Australian yoghurt and Polish soaps. When will it end?

There’s still a buying opportunity here, with PZ Cussons trading at 11.15 times earnings, while yielding 4.03%. Original Source bathing product sales are frothing up in the UK while the Childs Farm acquisition is making hay.

I’m tempted, but not quite tempted enough to buy it. The board still has a lot of work to do here. I may kick myself this time next year as PZ Cussons might just clean up in 2025.

The post Up 14% in a month! Is this forgotten FTSE 250 stock about to go ballistic? appeared first on The Motley Fool UK.

Leading consumer brands

There are not many companies that can boast a host of market-leading brands in their portfolio. PZ Cussons (LSE: PZC) can, though. These include Imperial Leather, Original Source, Carex, and Sanctuary Spa.

Despite being home to a suite of top brands, this is a company that has struggled to make itself relevant against much larger competitors, including Procter & Gamble and Unilever.

Since peaking at 400p in 2014, its share price has fallen ever since. Today, I can pick them up for 80p; a whopping 80% decline.

But it isn’t the past that matters but the future.

Hyperinflation in Nigeria

Compounding the company’s woes has been economic turmoil in Nigeria, one of its biggest markets. Hyperinflation and a currency devaluation has left the Nigerian consumer struggling.

The devaluation of the local currency, the naira, was a major contributor to a 20% slump in revenues in FY24. The company found itself with far too much local-denominated currency that it could not repatriate, due to difficulty obtaining US dollars.

Often, an existential crisis forces a business to re-evaluate its strategy and attempt to reinvent itself. PZ Cussons is doing just that. It has put in motion steps that could lead to the partial or full sale of its African business.

Despite being able to trace its roots to Nigeria, that sale of its African business would be a positive move, in my opinion. No business can expect to thrive when its profit and loss (P&L) account exhibits wild volatility swings. That is no way to create long-term shareholder value, either.

Reinvigorating its UK business

One of the criticisms I have long had with PZ Cussons is the sheer complexity of its UK portfolio. A bloated organisational structure with far too many layers of management has resulted in duplication across its supply chain.

Earlier this year, management took the decision to merge its Personal Care and Beauty divisions. Although too early to tell, the combining of these two businesses should provide significant cost savings.

But for me, cost savings is not enough. Out of the merger I want to see greater levels of commercial acumen as well as product innovation.

One advantage that it has over its rivals is its size. Being smaller should provide it with agility in a fiercely competitive market. As a cost-of-living crisis continues, brand positioning will be a critical enabler of success.

Speaking anecdotally, over the past year I have noticed many of its top brands such as Carex and Original Source taking prominent positions at major retailers. But I have also seen a greater deployment of its products in new places such as discounters and pharmacies.

There are undoubted risks of taking a position in a company whose share price has been declining for so long. But it wouldn’t take much of an improvement for sentiment to quickly change. As it trades at levels not seen since the early 2000s, I added more of its shares to my SIPP.

The post At a 20-year low, could this FTSE 250 stock be a value investor’s dream? appeared first on The Motley Fool UK.

Let’s examine what’s happened and whether there’s a buying opportunity for me.

Cleaning house!

PZ Cussons is best known for its cleaning and hygiene products with approximately 30 brands. Some of these include Imperial Leather, Carex, and more.

Over a 12-month period, the shares are down 44% from 160p at this time last year, to current levels of 89p.

Recent issues and trading

PZ Cussons released a full-year update for the period May 2023 to May 2024 last week. On the surface of things, it didn’t look great. The headline for me was that underperformance was primarily due to issues with African currency, the Nigerian naira, to be exact. Currency conversions can impact trading updates when recorded in a local currency, and this is a prime example.

Digging deeper, the business still recorded a healthy profit after tax of over £44m. Furthermore, managed to aid its balance sheet by reducing debt levels from £251m last year, to £167m in this update. If PZ’s African business is excluded from the report, like-for-like revenue only fell 2.6%, which isn’t bad considering economic volatility globally.

The market didn’t react well when the news emerged, and the shares dropped close to 15% on the day. Personally, I think this was an overreaction.

To buy or not to buy?

From a future perspective, the firm’s management team are looking at two possible solutions. The first one is the sale of the African business totally. Another is to deal in US dollars as much as possible, as this is a much less volatile currency globally. From a risk perspective, if either of these things don’t happen, I wouldn’t be surprised to see PZ Cussons’ updates look similar to the one of last week.

Another issue I’m concerned about is that of PZ’s premium brands. During times of volatility like now, consumers can move away from branded goods towards non-branded essential ranges to conserve cash. This could impact performance and returns moving forward.

On the other side of the coin, it’s worth noting PZ Cussons’ does possess defensive attributes, in my view. This is because its products are consumer staples. Everyone needs to clean their homes and themselves! Defensive ability could help the business recover from recent issues.

Next, the shares do offer a dividend yield of over 5% at present. I must note that this has been pushed up by a falling share price. Plus, dividends are never guaranteed.

Finally, top brokers Deutsche Bank have given PZ Cussons a ‘buy’ rating, and a price target of 130p. This is a potential 46% increase from current levels. However, I’ll always take broker forecasts with a pinch of salt.

What I’m doing now

Personally I’m not going to buy any shares until I see some tangible movement to address the issues the firm has had in Africa. This includes a sale of the business or better currency management options.

I like the business, especially its defensive traits and track record, so I’ll keep a close eye on things.

The post This value stock is down 44% in a year! Should I buy the dip? appeared first on The Motley Fool UK.

Problems abroad

One I’ve spotted is PZ Cussons (LSE:PZC). I feel this has stayed under the radar for several months, but strayed onto my screen earlier this week following the sharp 15% drop on Wednesday (18 September). This was due to the release of disappointing full-year financial results.

However, the main factor within the results that caused 29.7% fall in adjusted profit before tax was the situation in Africa. PZ Cussons has an active presence there and gets paid in local currency. Yet if it gets devalued, it can cause a hit to results when converted back to British pounds. This was the case with the 57% fall in the value of the Nigerian naira during the reporting period.

The extent of the fall means that the stock has almost halved in value over the past year. I think this is excessive, primarily because I believe the issues in Africa can be resolved. PZ Cussons is already in discussions about potentially selling its Africa operations. Further, it’s taking measures to try and deal more in US dollars in the countries, reducing its currency volatility.

Of course, a risk is that it can’t sell the division quickly and we get further devaluation over the next year. This would negatively impact financial results again. Yet at the core, PZ Cussons is a profitable business that has a long track record of being so.

Now’s the time

The other company is the Watches Of Switzerland Group (LSE:WOSG). I’ll admit that earlier this year I wrote about how I’d steer well clear of it after it lost 37% in a day back in January. The stock is still down 33% over the past year, but I feel the situation has now changed.

The drop came after the business issued a profit warning for the full-year following a disappointing festive trading season. At the time, I was rather pessimistic about the UK economy in general, with high inflation and non-existent economic growth. Therefore, why would a luxury watchmaker do well?

Fast forward to today and the UK is in much better shape. Interest rates have started to fall, inflation is close to the 2% target level and consumer sentiment is a bit stronger. The business has felt this, with an update earlier this month stating that “we have seen continued stabilisation of the UK market in both luxury watches and jewellery”.

Yet the share price is only up a modest 4% in the past six months. I feel it’s good value here. It offers me a way to make a play on the UK economy outperforming in the next year. My main risk is if we get some kind of spike in inflation or economic shock that causes consumer spending to slow down.

I like both stocks and have them on my watchlist to purchase when I have free money.

The post 2 below-the-radar value stocks that haven’t escaped my detection appeared first on The Motley Fool UK.

Problems in Africa

Firstly, let’s get the bad news out of the way. The main reason for the drop was the release of the full-year results. It might seem odd for these to come out in September, but the firm operates on a financial year that runs through to the end of May, with results out in September.

In the May-May period, the business saw revenue drop by 19.6% versus the year prior, with profit before tax falling by 39.7%. Even with this drop, it still recorded a profit of £44.7m. Gross debt reduced significantly from £251m at the end of May 2023 to £167m in May 2024.

In the report, the underperformance was blamed on the devaluation of the Nigerian naira. The business earns money in the local currency from operations in the country. Yet it has to sell this and buy British pounds. So the fact that the naira devalued by 57% during the year massively eroded revenue for PZ Cussons.

The impact of this is very telling. If we exclude Africa, like-for-like revenue only fell by 2.6%.

Solutions from here

I understand that the fall in financial performance has spooked some investors. Yet the management team are taking action. They knew that African operations would be a negative not just this year but potentially going forward. Therefore, it has already started conversations around selling it off. The report noted that “the board has received a number of expressions of interest in the Africa business and it is possible that this could lead to a partial or full sale”.

Until this happens, the business is focused on improving US dollar sourcing in Africa, meaning that it doesn’t have to deal as much in local currency. The value of the dollar is much less volatile, meaning that earnings won’t be impacted as much.

When I put this all together, I don’t see the company’s Nigerian operations as being a problem if we fast forward a couple of years down the line. Excluding Africa, things are going well. The UK market is doing much better, with Carex posting a growth year. The initial in-store launch of Childs Farm in the US also bodes well for the coming year for that brand.

Becoming a value play

Let’s also not forget that many of the brands that PZ Cussons sells are consumer staples. This should act to make it a defensive stock which could do well if we get a stock market crash.

The main risk I see is that I might be too early in buying the dip here. The stock is now down 49% over the past year. If pessimism persists, I could be holding an unrealised loss for some time before it has a chance to make a comeback. Even with this, I think it looks like a great value purchase for my portfolio.

The post This FTSE 250 stock fell 15% yesterday. Here’s why I want to buy the dip appeared first on The Motley Fool UK.

Some of us never forgot them, mind. And three that I like the look of are due to report in September.

Cash cow #1

House builder Barratt Developments (LSE: BDEV) has full-year results due on 4 September. The share price is down over five years, which helps keep the forward dividend yield at a healthy 5.1%.

For long-term dividend income, I reckon this could be one of the more sustainable. And this yield is in a down year when the business is under pressure. Forecasts show earnings starting to grow again from 2025 onwards.

With the firm’s July trading update, the board said it “intends to declare an ordinary dividend in line with policy, with dividend cover of 1.75 times adjusted FY24 earnings per share“.

We’re not out of the woods, as many people have other costs on their minds. Energy prices are rising, and the humble British fish and chips dinner has gone through the roof.

But even with more short-term uncertainty, I think I’d buy now if I didn’t already own some house builder shares.

Cash cow #2

While eyes turn to finance stock yields, I think the 9.1% forecast for Chesnara (LSE: CSN) has dipped under the radar.

The life sssurance and pensions consolidator has seen its share price fall in the past couple of years.

It’s only a relatively small company, with a £400m market cap, in a big insurance sector. And that’s possibly the biggest risk. Smaller firms might not have the same resilience needed to handle any new downturn quite so well as larger peers.

I reckon that could keep investors away and focused more on big FTSE 100 stocks.

But at the time of FY 2023 results, Chesnara reported a rise in commercial cash generation to £53m, with strong solvency. CEO Steve Murray said “The two acquisitions we delivered in 2023 show we have continued momentum behind our acquisition strategy“.

The company lifted its dividend by 3%. First-half results are due on 10 September.

Cash cow #3

Over at PZ Cussons (LSE: PZC), we’re looking at a 5.1% forward dividend yield. The poor share price chart for the past five years has helped with that.

But if the full-year results due on 18 September are any good, I wonder if we might see the start of an upturn.

One problem is that Cussons has had a tough time in Nigeria, which made up more than a third of its 2023 revenue.

Still, in June’s trading update, the firm said it held minimal surplus cash in Nigeria. And we were reminded of the “plan to maximise shareholder value from a portfolio transformation, following a strategic review of brands and geographies.“

“An update will be provided when appropriate“, the board added.

The risk through uncertainty seems clear. But if Cussons can align itself with upbeat forecasts, we could see the stock valuation fall and the dividend cash grow.

The post 3 high-yield dividend stocks to consider buying in September appeared first on The Motley Fool UK.

Yet the Imperial Leather maker has a lot going for it. It has made tens of millions of pounds of profit in four of the past five years (including last year).

Last year saw revenues grow to over £600m. The dividend yield is a juicy 6.3% for now (although it remains to be seen whether the annual dividend will be maintained at its current level).

So is this beaten-down FTSE 250 share a possible bargain for my portfolio?

Difficulties trading in developing markets

I think the answer is yes. But there are some clear risks here that help to explain the share price collapse. In one word, the key risk is Nigeria.

But that is simply a specific example of a bigger risk hardwired into the company’s business model of operating in developing markets with unpredictable political situations.

That can actually be a great move for a company like PZ Cussons. Some such markets, including Nigeria, offer huge untapped opportunities with young populations and higher prospects of economic growth than developed economies.

But they can be very difficult to operate in. Even FTSE 100 giant Diageo announced plans to sell a majority stake in its Nigerian Guinness brewer recently. My shareholding in Airtel Africa has been hit by a devaluation of the Nigerian currency.

After falling around 70% in the year leading up to PZ Cussons’ interim results, the unstable currency was described in those results as “the most significant challenge we have faced by far”. During the period, revenue fell 18% year-on-year and pre-tax profit was down by almost a quarter.

Why I see value potential

Nigeria continues to face significant challenges – and so does this FTSE 250 firm that generated over a third of its revenue there last year.

But with its long history of working in developing markets including the west African nation, I think PZ Cussons is well-placed to meet this challenge.

At some point I expect the currency problems in Nigeria to lessen. Meanwhile, the soapmaker has been trying to conduct more business there in US dollars than the local currency as a way to mitigate the impact on its financial performance of an unstable exchange rate.

Clearly the coming months will remain difficult. But the share price fall looks overdone to me. PZ Cussons has a proven business model, a large global customer base, well-established premium brands and is a money-making enterprise.

Airtel Africa means I am already as exposed to the Nigerian currency problems as I want to be. So I shall not be investing in PZ Cussons. But I do think the FTSE 250 share, trading on a price-to-earnings ratio of 9, looks like a bargain.

The post This FTSE 250 share looks like a bargain to me! appeared first on The Motley Fool UK.

Details of the firm

PZ Cussons (LSE:PZC) is a well-known FTSE 250 company. It’s an international consumer goods business that owns brands such as Carex and Imperial Leather. As such, it mainly operates in the hygiene and beauty area, but has a broad portfolio.

In most cases, such consumer goods businesses do well. After all, the price level of many products is low, meaning these aren’t luxury goods. Further, given the everyday nature of many items, these are necessities rather than discretionary. So even during economic uncertainty, the share price should be steady.

Yet for PZ Cussons, the stock is down 43% over the past year. In fact, last month it hit low levels not seen in over a decade!

Issues in Africa

A large problem is its exposure to emerging markets. For example, around a third of total revenue comes from African operations, with Nigeria having the largest share. Yet the local currency has depreciated heavily. In a report during February, the firm said the currency had lost 70% of value in the past year.

This has really hurt the business. For example, in the half year report released earlier this year, revenue came in at £277.1m, a fall of £59.8m from the same period in the previous year. Incredibly, £52.9m of this fall was attributed to the Nigerian naira!

Management said it’s dealing with the issue. I don’t think it takes a genius to figure out that action has to be taken.

In an update last month, the company said it has “embarked on plans to transform our portfolio, refocusing on where the business can be most competitive.” I’m guessing Africa will be less of a priority.

Just a blip

Despite the African headache, I’m thinking about buying the stock now. The issues with local currency don’t mean PZ Cussons is a bad business. By refocusing on other markets around the world that are more stable, I’m confident that this will just be a blip on the radar when we look back.

In fact, when I look at the high valuations of tech stocks and some other areas, I think it makes sense to include a larger, mature value stock like PZ Cussons in my portfolio. Over the long term, I believe the share price can recover… not to mention the dividend income I could pick up along the way.

The post Down 43% in a year, I think this value stock is primed for a comeback appeared first on The Motley Fool UK.

[Just beginning your investing journey? Check out our guide on how to start investing in the UK.]

Barclays

What it does: Barclays is a UK clearing bank, founded in 1690. Big in business and consumer lending, it also has an investment bank.

By Cliff D’Arcy. Currently trading at 142p each, Barclays (LSE:BARC) shares have dropped 17.7% over one year. This has lowered its market value to £21.5bn.

Long-suffering shareholders despaired as the bank racked up billions of pounds of fines in various mishaps. Right now, Barclays stock looks like a classic value trap.

That said, the shares are so lowly rated that they could offer huge upside. This FTSE 100 stock trades on just 4.2 times earnings, producing an earnings yield of 23.6%.

Likewise, the dividend yield of 5.4% a year is covered 4.4 times by earnings. This is seriously solid coverage, leaving room for future uplifts.

Then again, 2024 could be a tough year for British banks, thanks to falling house prices, lower credit growth and rising loan losses.

Even so, I will keep my Barclays stake for its income stream, while patiently waiting for the share price to rebound!

Cliff D’Arcy owns shares in Barclays.

ITV

What it does: ITV is a UK media company that offers TV broadcasting. It has also begun to provide streaming and content creation services.

By Charlie Keough. A 33% decline in its share price across the last 12 months doesn’t bode well for ITV (LSE: ITV) shareholders. But now trading on just 8.5 times earnings, I think the broadcaster could be a bargain.

The business has been hit in recent times. The advertising industry is flagging. This was evident from ITV’s falling advertising revenues in the first half of 2023.

However, I’m not writing off the value stock just yet. I think there’s plenty to like. For example, its declining share price now means it offers a whopping 8.6% dividend yield.

On top of that, the firm is aware it needs to diversify. As a result, it has placed greater emphasis on its production arm, ITV Studios. In the first six months of 2023, revenues for this division were up 8% to £1bn. It’s also upped its investment into ITVX, its streaming platform.

I’ve had ITV on my watchlist for a while. I think March may be the month I snap up some shares.

Charlie Keough does not own shares in ITV.

PZ Cussons

What it does: PZ Cussons is a consumer goods company, which owns brands including Imperial Leather, St. Tropez and Sanctuary Spa.

By Andrew Mackie. Often, when sentiment in a stock is so low that’s the time to step in. I believe that’s the case with PZ Cussons (LSE:PZC) today. The latest body blow to its share price came in the form of a revenue downgrade following the devaluation of the currency in its biggest market, Nigeria.

Beyond this issue, clearly, the company has made a number of mistakes in the last few years, which it’s freely acknowledged. However, with a long history and deep expertise in consumer branding, I am confident it can bounce back.

In the UK, it has recently stepped up its marketing and communications both in print and digital to help set its brands apart in a crowded marketplace. One such initiative has been the launch of its first ever multi-brand full console arena display across 250 Sainsbury’s stores. Off the back of such initiatives, many of its personal care brands have begun witnessing a return to growth.

There’s no silver bullet when it comes to reviving this company’s fortunes. But then, no one gets to call the bottom on a stock. As it languishes at levels not seen since 2007, it’s a perfect time for me to take a contrarian stance.

Andrew Mackie owns shares in PZ Cussons.

Redde Northgate

What it does: Redde Northgate is a van hire and accident repair group, mainly serving SME and corporate customers.

By Roland Head. Redde Northgate (LSE:REDD) has benefited from tight supply conditions in the car and van markets over the last few years. The group’s hire fleet has been busy, and it’s also benefited from strong sale prices on ex-rental vehicles.

Meanwhile, a return to more normal road traffic levels following the pandemic have supported activity in the group’s accident management division.

The risk is that these favourable conditions are unlikely to last forever. Markets normally rebalance eventually.

City analysts do expect profits to ease slightly over the next couple of years. But I think a lot of bad news is already in the price.

Redde Northgate shares currently offer a 7% dividend yield and are priced in line with their tangible book value of 348p per share. In my experience, that’s unusually cheap for a business that appears to be in good health.

I think this FTSE 250 stock offers good value right now.

Roland Head does not own shares in Redde Northgate.

The post Best British value stocks to consider buying in March appeared first on The Motley Fool UK.

J.D. Wetherspoon

What it does: J.D. Wetherspoon is a UK pub chain. The company is known for consistent food, decent beer, and low prices.

By Stephen Wright. I really ought to have been buying shares in J.D. Wetherspoon (LSE:JDW) for a lot longer than I actually have. But I’ve been buying more of the stock lately. 

I think the market is making a mistake with this company. The firm has been reducing the number of pubs it operates, but this isn’t a sign of a business in decline.

Instead, it’s a move to maintain its competitive advantage. By reducing lease commitments, the company can keep its costs low, which is what allows it to charge low prices to customers.

I expect those low prices to allow Wetherspoon’s to remain durable in an economic downturn. But inflation are a bigger challenge – and probably the biggest risk with the stock.

The good news, though, is that the Bank of England is focusing on reducing inflation, rather than boosting the economy. In my view, those are favourable priorities for a low-cost pub chain.

Stephen Wright owns shares in J.D. Wetherspoon.

Legal and General Group

What it does: Legal and General Group provides life insurance policies, pensions, and a raft of other financial products.

By Royston Wild. There are multiple ways for UK share investors to profit from the developing ‘grey tidal wave’. I chose to do this by opening a position in Legal and General (LSE:LGEN) last summer. I then added to my holdings earlier this month.

From a value standpoint, I think the financial services firm is one of the most attractive ways to capitalise on the world’s rapidly-ageing population. It trades on a forward price-to-earnings (P/E) ratio of 8.4 times. Its corresponding dividend yield, meanwhile, sits at a showstopping 9.3%.

The over-65 demographic is growing at an incredible pace. According to the United Nations, 16% of the global population will fall within this category by 2050, up from 10% in 2022. This provides excellent sales opportunities for Legal and General.

While it faces fierce competition, I still expect demand for the FTSE 100 firm’s retirement, protection and wealth products to rise strongly in the coming decades.

Royston Wild owns shares in Legal and General Group.

Michelmersh Brick Holdings

What it does: The company has seven brands that operate to manufacture clay bricks and pavers and owns a landfill operator.

By Oliver Rodzianko. Michelmersh Brick Holdings (LSE:MBH) seems like an exceptional business for me to own. I view it as undervalued, highly profitable, and a nice way for me to diversify away from the heavy technology focus I have in my portfolio.

To put it into perspective with its competition, its net margin is in the top 25% of companies in the building materials industry. Additionally, I think its balance sheet is exceptional, with equity balancing 70% of its assets. Also, its dividend yield is 4.4%.

However, this isn’t a high-growth investment in terms of its share price. It’s up only 48.5% over 10 years, which is slow. Also, if there’s a crash in the housing market, the results would be poor.

Nonetheless, it has a price-to-earnings ratio of just 9.5. Because I think I’m buying the stock at a low price, and the dividend contributes to my income, I’m a happy shareholder.

Oliver Rodzianko owns shares in Michelmersh Brick Holdings.

PZ Cussons

What it does: PZ Cussons is a consumer goods company, with a portfolio of brands across hygiene, baby and beauty.

By Andrew Mackie: The PZ Cussons (LSE:PZC) share price has been in a downward trend for over a decade. The last year has been particularly brutal with the stock down 50%. Its immediate challenge is navigating a devaluation in the Nigerian Naira, which wiped £60m off of its H1 FY24 revenues.

However, with the stock now trading at a 15-year low, I decided to take the plunge and buy some. When I look beyond all the negative headlines, I see a business with a number of growth opportunities.

Its UK personal care business has started to see a turnaround in performance lately. I see signs of positive momentum beginning to build across many of its core brands. For example, the launch of Morning Fresh into the Australian auto dishwasher market, is helping to grow revenues in that geography.

I am under no illusion that the business has a mountain to climb if it’s to deliver sustainable growth. However, one key lesson I’ve learnt on my investing journey, is that when investor sentiment in a stock is so low, that’s often the best time to step in.

Andrew Mackie owns shares in PZ Cussons.

Safestore

What it does: Safestore is the UK’s largest self-storage unit provider. It has over 130 stores nationwide as well as a growing international presence.

By Charlie Keough. I continue to increase my position in Safestore (LSE: SAFE). There are a few reasons why.

What I most like about the business is its ambitious growth plans. It dominates the UK. As a result, it’s now looking to build its international portfolio. For example, last year it added 500,000 square feet of lettable area across 13 sites.

Trading on a price-to-earnings ratio of 8.9, I also think Safestore shares look cheap. That’s below the FTSE 250 average of around 12.5. Coupled with a cheap valuation is a 3.7% dividend yield.

Debt on its balance sheet could be an issue. High interest rates make this more difficult to pay off. Higher rents may also see businesses look to cut down on costs.

But that’s a short-term concern. And down 23.1% in the last 12 months, as I write, I think Safestore shares are a steal. If I have any spare cash going forward, I’ll slowly continue to increase my holding.

Charlie Keough owns shares in Safestore.

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