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Authoritative Independent Monthly Share Selections Using Technical & Fundamental Analysis

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Essentra - Cluster buying by directors

May 2023

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:
  • ESNT
  • Price:
  • 195p
Results for 2022 offered the first glimpse of Essentra’s rosy future as a stand-alone components business. It recorded 12% revenue growth (c. 6.5% organic) and lucrative EBIT margins of 18.9% before central costs which, as Berenberg says, “demonstrates an ability to protect profitability and drive growth despite the challenging macroeconomic backdrop.” The broker goes on: “from here the story is compelling: cash disposal proceeds will fund the restructure of the group, invest in a new enterprise resource planning (ERP) system to drive growth; build out its digital offering; drive enhanced customer offering and cross-selling; conduct M&A; and return £150m to shareholders” (it recently went ex a £90m (29.8p) special dividend and is con ...

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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.

All material on this website is protected by copyright. You may use Information retrieved from the www.scsw.co.uk website for your own personal non-commercial use which means that you may not sell or copy this information to any third party without prior written consent. ISSN 1358-183X

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