Turkey of the Week: a share pushed too high by private equity

The private-equity boom has sent the share prices of many low-growth and quite ordinary companies rocketing well beyond profit expectations. Just look at the pubs sector.

The private-equity boom has sent the share prices of many low-growth and quite ordinary companies rocketing well beyond profit expectations. Just look at the pubs sector. This has seen a massive re-rating due to lower perceived risk, attractive property portfolios and hopes that companies will convert to real-estate investment trusts (REITs). These stocks are very fully valued on 20 to 30 times 2007 p/e ratios, even though earnings growth is forecast to be only 10% a year or so. This week's turkey is one example:

Luminar (LMR), rated a BUY by Panmure Gordon

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