Three to buy
Indivior
(The Sunday Times) In 2019 Indivior was charged in the US with running an “illicit nationwide scheme to increase prescriptions” of a version of its opioid-addiction treatment. But the drugmaker seems to have redeemed itself. It has invested in a new treatment for cannabis-related disorders, branched out into alcohol-misuse drugs and grown sales of its injection for opioid addiction. But the stock is still selling for half its 2018 price. Sales are rising fast.
Once Indivior regains investors’ trust, it will consider mergers. Buy now. 240p
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Light Science Technologies Holdings
(The Mail on Sunday) Just 23% of fruit and vegetables sold in the UK are grown locally. Our reliance on imports raises our greenhouse-gas emissions. Light Science Technologies Holdings aims to bolster the proportion of fruit and vegetables grown here. It produces 40 variations of lighting kit that helps fruit and vegetables grow in glasshouses, along with sensors that monitor the conditions plants need to thrive. The company listed this month, and the shares should appreciate substantially as investors focus on producing food closer to home. 12p
XP Power
(Shares)
Some companies have been better at navigating global supply-chain strain better than others. Power-components designer XP Power (products include converters and other gadgets) is getting better at it. Third-quarter order wins of £97.3m have propelled the order backlog to £186m. Management sees scope to continue boosting margins, while a strong balance sheet should facilitate acquisitions. 5,248p
Three to sell
Sanderson Design Group
(The Daily Telegraph) Sanderson, the wallpaper-to-fabrics company, has a “rich heritage and strong brand portfolio”. The company recently reported a profit, the return of its dividend and net cash on its balance sheet. The good news means expectations have been raised, and the shares look vulnerable to “any stumbles or disappointments”. They have risen by 165% in three years and cost 20 times earnings. Time to “draw the curtains” and take profits. 200p
Hurricane Energy
(Investors’ Chronicle) Macroeconomic events have “overtaken the drama” Hurricane Energy’s investors went through six months ago. Directors “had effectively given up” and asked investors to support a plan to hand back the company to creditors. Today, higher oil and gas prices have raised cashflow, and the company has bought back a third of its bonds. But the challenge of funding investment in its assets remains. And if the board can’t invest in production or dividends, there are better options elsewhere. Sell. 4.7p
Whitestone Reit
(The Motley Fool) Whitestone owns 60 strip malls in the fast-growing states of Texas and Arizona, which sounds bullish. But while many of its locations are filled with stores people visit often, only about half of them have a grocery store, which is considered one of the most important components of strip malls as it keeps people coming back on a weekly basis. Adding more grocery stores to its holdings doesn’t seem like a priority either. Investors keen on consistent dividends may be better off sticking with the real-estate investment trusts (Reits) that follow industry practices. Avoid. $9.83
...and the rest
The Daily Telegraph
Tirupati is a miner of graphite, a material likely to play a big role in the decarbonisation of energy and transport. It has also developed an alloy of graphene and aluminium that could replace copper wires. The share price has fallen but investors should hold (87p). Oil and gas prices remain firm, which could bode well for Royal Dutch Shell. Fresh supply “does not seem to be forthcoming”, so “oil and gas prices could yet surprise”. Hold for now (1,790p).
Investors’ Chronicle
YouGov has benefited from the rise of social media and the internet, which has enabled marketers to micro-target customers. It collects and disseminates bespoke data, which has driven profits. Post-pandemic, businesses will be looking to expand their marketing channels.
Buy (1,315p).
Shares
Cybersecurity and defence company QinetiQ surprised investors when it highlighted a supply-chain issue related to a “complex, multi-year programme”. Management seem confident the issue is temporary, but shares still dropped by 13%. This is a buying opportunity (291p).
Batteries, vaping and vitamins specialist Supreme’s shares rose when it reported a strong performance for the six months to September 2021. Margins have proved strong, which augurs well for profit. Buy (195p).
The Mail on Sunday
1Spatial’s clever technology “is winning plaudits”. It helps governments, utility firms and emergency services, among others, pinpoint buildings, power stations and pipes. Existing shareholders should hold; new ones can buy. 46p
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