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Authoritative Independent Monthly Share Selections Using Technical & Fundamental Analysis

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Primary Recommendation

Babcock International - Huge order book for defence services firm

July 2008

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • BAB
  • Price:
  • 584p
For a company whose most important customer is the Ministry of Defence (MoD), Babcock might seem an odd choice for TMI given that the Government has indicated spending on health and education are going to be given  greater priorities than defence. However, Babcock is actually gaining business because as a champion of outsourcing it not only makes huge cost savings for the MoD but it also ensures that expensive assets such as warships and submarines are patched up to last as long as possible before being retired. Using this simple strategy, Babcock has grown quickly in the last five years with pretax profit soaring from £13m to £95.5m, while eps has risen from 9p to 33.4p. Latest forecasts are for eps to rise another 26% to 42.1 p ...

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Babcock International - 78% of revenues secured for FY'17 (August 2016)
Babcock International (July 2015)
Babcock International - Order book increased by £5bn (February 2015)
Babcock International - Preferred bidder for £7bn contract (May 2014)
Babcock International - Acquires cyber security specialist (February 2014)
Babcock International - Bid pipeline remains promising (January 2014)
Babcock International - Two preferred biddder announcements due (October 2013)
Babcock International - Defence outsourcing firm aiming to exploit record £15.5bn bid pipeline (July 2013)
Babcock International - Gain to date:538% (December 2012)
Babcock International (May 2010)
Babcock International (March 2010)
Babcock International - Sharp reduction in borrowings (January 2010)
Babcock International (November 2009)
Babcock International - Positive AGM (August 2009)
Babcock - Defence services group sees near doubling in order book (June 2009)
Babcock International - Two largest divisions going well (March 2009)
Babcock - Strong results rally shares (December 2008)
Babcock International (October 2008)
Babcock - Sharp rise in order book (September 2008)
Babcock International (June 2008)
Babcock International - Eyes up big contract win from new aircraft carrier programme (May 2008)
Babcock International - Price target 640p (March 2008)
Babcock International - Defence services company makes key naval base acquisition (November 2007)
Babcock-International - Gains hit 125% (January 2007)
Babcock - Share price strength puts off bidders (June 2006)
Babcock International - Bid approach (May 2006)
Babcock International - Wins £500m contract (January 2006)
Babcock International - Big opportunity in defence outsourcing (September 2005)

With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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