Avoid Foxtons, the Sunday Telegraph's Questor said. Amid fears of a property bubble, the London market, where the estate agent does most of its business, has outperformed the rest of the UK by 10 times. The shares
gained 14% after they started trading 0n September 20th and are already looking pricy. On Questor's calculations Foxton's is trading at 24 times forecast adjusted earnings per share. That is expensive for a business where profit and revenue are rising by 6% year, Questor concluded.
The Mail on Sunday's Midas column said buy Unite Group, the student housing builder. With more than 1.2m full-time students in Britain living away from home and 100,000 undergraduates scrabbling for accommodation each year, Unite is in the right market. After a drop-off in the first year of student fees, demand for university places has revived and most of Unite's properties are in cities with sought-after universities. Land outside London is priced at 10-year lows and Unite's borrowing costs have fallen. Chief Executive Mark Allan is capitalising on benign conditions and the shares should provide steadily rising profits and dividends for the next few years.
Fizzy drink maker AG Barr's shares have had a good run in the past year, rising 15%, and investors can look forward to more effervescence, the Sunday Times's Matthew Goodman wrote in the Inside the City column. After missing out on two acquisitions, Britvic and GlaxoSmithKline's soft drinks arm, Barr is emphasizing organic growth and is likely to stress that message when it posts results on September 23rd. A new bottling plant in Milton Keynes was up and running a month a head of time. Half-year pre-tax profits forecast to be up 12.4% should help the Irn Bru maker's shares continue their positive run, Goodman wrote.
Take profits from the near doubling of online fashion retailer ASOS's shares, The Sunday Telegraph's Questor advised. The company is well run and will keep growing but it is trading at a vertigo-inducing 84 times 2014 forecast earnings. After ASOS's upbeat Septemer 19th trading update, analysts are over-excited about its prospects. With economic recovery not yet entrenched, valuing a company's shares on four years of strong growth, as in ASOS's case, is too risky so sell, Questor said.
Since floating on AIM almost a year ago, Clinigen has done just what it said it would, Matthew Goodman wrote in the Sunday Times. The pharmaceutical company has produced new drugs, such as a breast cancer treatment, and has boosted its income. The shares have been rewarded by more than doubling in price since being traded. Management's lock-up period ends soon but if they decide to cash in this may be offset by pent-up demand, Goodman said.
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