Share tips of the week – 19 November

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.

Three to buy

SDI

(Shares) Scientific-products maker SDI, whose offerings range from digital-imaging equipment to electrochemical sensors, has had “a very encouraging” recovery. It says it has enjoyed “very strong sales and profits” recently thanks to an unexpectedly good performance from Monmouth Scientific, which it acquired last December. The company looks set for multi-year growth. The shares have gained 23% in six months but there should be further to go. 216p 

Wizz Air 

(Investors’ Chronicle) Budget carrier Wizz Air has struggled with the implementation of vaccine passports because vaccination rates in its key markets (central and eastern Europe) are lower than in the rest of Europe. However “there is hope of a rapid turnaround”: the percentage of Romanians who are fully vaccinated is expected to jump from 30% to 75% by February. The carrier reported improvements on last year for the six months to 30 September: ebitda reached €164m compared with an €81m cash loss in the same period last year. It has yet to regain pre-pandemic heights, but should continue to benefit from the travel rebound in 2022. 4,805p

OSB Group 

(The Mail on Sunday) Lender group OSB floated in 2014 with a market value of £400m. Today it is worth over £2.25bn. CEO Andy Golding has “put together a business with lower costs, higher profit margins and stronger customer loyalty than virtually all its peers”. Brokers are expecting full-year profits to jump by 60% to £425m. The group’s strong balance sheet and the promise of share buybacks and a special dividend next year make it a buy. 501p

Three to sell

High Tide 

(The Motley Fool) High Tide, a cannabis retailer, is not a profitable business “and likely won’t be for a long time”. It has reported sales of C$152m (£90m) and losses of C$32m (£20m) for the year to the end of October. Its gross margins of 36% “aren’t bad, but they’re likely to get... worse” following the recent launch of its “discount club loyalty plan”. This will attract more customers but hamper longer-term profitability. Avoid. C$9.82 

CureVac

(The Daily Telegraph) CureVac is a German mRNA specialist, like Covid-19 vaccine developer BioNTech. The latter’s shares have jumped since last year when it announced the partnership with Pfizer had resulted in an effective jab. Unfortunately the resemblance between the two mRNA firms “does not extend to share-price performance”. The stock has lost two thirds of its value since February. There was hope its vaccines would be effective against new coronavirus variants, but development has lagged more than expected and the company has abandoned its first-generation vaccine. Investors should sell now before the share price becomes even more volatile. $35.87 

Games Workshop

(The Sunday Times) Games Workshop sells table-top figurines for fantasy settings such as Warhammer. It is “embroiled in a skirmish with... customers”. Determined to protect its intellectual property, it is clamping down on fans ripping off its miniatures with 3D printers. That is not unreasonable, but “rather more brutal” is the decision to punish fans creating animations based on their characters. Customers are irritated and the stock has slid. Sell. £96.60 

...and the rest

Shares

Ford Motor Company has refreshed its product range, pivoting towards electric vehicles. The strategy seems to be paying off: Ford was the top-selling US carmaker in the last two consecutive months. Buy now for long-term growth ($20.50). Electrical goods retailer Currys’ shares went up after it revealed a £75m share buyback programme and robust performance for the six months to 1 October. It has also managed to “mitigate supply chain and staffing issues”. Keep buying (134p)

Investors’ Chronicle 

DCC is “an eccentrically diversified conglomerate”, supplying oil and petrol in the UK, beauty products in Germany, and “bits of cable” in France. Operating profits rose by an annual 15.5% in the six months to 9 November. Hold (6,254p). Electrocomponents, which distributes electrical and industrial parts, has benefited from the growth in online spending. It reported a 91% year-on-year increase in pre-tax profit to £142m for the six months to September and its customer base has grown by 24% in the last two years, but it’s not immune to cost pressures. Hold for now (1,178p).

The Motley Fool

Latin American travel portal despegar.com was having a hard time even before the virus. Revenue slipped in 2019. Third-quarter sales in 2021 are expected to total 43% less than in the same quarter two years ago. Avoid ($11.49)

The Daily Telegraph 

Gerresheimer, which makes phials for vaccines, has seen its shares drop by 18% in a year. But demand for vaccines and their containers isn’t going anywhere. Hold (€79.40).

Recommended

The end of cheap money hits the markets
Stockmarkets

The end of cheap money hits the markets

Markets have swooned as central banks raise interest rates, leaving the era of cheap money behind.
28 Sep 2022
How the end of cheap money could spark a house price crash
House prices

How the end of cheap money could spark a house price crash

Rock bottom interest rates drove property prices to unaffordable levels. But with rates set to climb and cheap money off the table, we could see house…
28 Sep 2022
Hundreds of mortgage products withdrawn as interest rates surge
Mortgages

Hundreds of mortgage products withdrawn as interest rates surge

Hundreds of mortgage products have been withdrawn after sterling crashed to the lowest levels in decades against the dollar and the Bank of England sa…
28 Sep 2022
What changes to the pensions charge cap mean for you
Pensions

What changes to the pensions charge cap mean for you

The government could raise the pensions charge cap – the amount you can be charged in your workplace's default pension fund. Saloni Sardana explains w…
27 Sep 2022

Most Popular

Beating inflation takes more luck than skill – but are we about to get lucky?
Inflation

Beating inflation takes more luck than skill – but are we about to get lucky?

The US Federal Reserve managed to beat inflation in the 1980s. But much of that was down to pure luck. Thankfully, says Merryn Somerset Webb, the Bank…
26 Sep 2022
Earn 4.1% from the best savings accounts
Savings

Earn 4.1% from the best savings accounts

With inflation topping 10%, your savings won't keep pace with the rising cost of living. But you can at least slow the rate at which your money is los…
27 Sep 2022
The pick of this year's best-performing investment trusts
Investment trusts

The pick of this year's best-performing investment trusts

Market conditions haven’t been easy, but these investment trusts have delivered strong growth, says David Stevenson.
23 Sep 2022