Craneware shares soar with ‘return to strong sales growth’

Jamie Gordon
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Craneware shares soar with ‘return to strong sales growth’
Provider of software solutions for the US healthcare sector, Craneware (AIM:CRW) saw its shares bounce on Tuesday, as it announced a “return to strong sales growth” ahead of its AGM. The company said that trading during the first four months of the fiscal year were ahead of management expectations, and “considerably ahead” of the same period the year before. The company’s statement added that:

“[We] expect revenues and adjusted EBITDA for the Interim period to 31 December 2020 to be ahead of the equivalent period in the prior year, building the foundation for a return to double-digit growth in the future. We look forward to providing further details within our Trading Update for the 6 months ended 31 December 2020.”

The company’s Value Cycle software offering continued to be well-received by leadership teams at US hospitals, with its Trisus Cloud-based software enabling hospitals to improve patient outcomes, while improving the operational and financial performance of hospitals. The Craneware statement added:

“With each hospital that joins the platform, Trisus becomes more powerful. Through the recent beta launches of the Trisus (cloud) versions of our core offerings, Chargemaster Toolkit and Pharmacy Chargelink, and our four live Trisus native cloud applications, we now have multiple means by which new and existing customers can join the Trisus Community, providing them with a gateway to the wider benefits the platform can provide.”

“We continue to see substantial new opportunities entering the sales pipeline and the Board is confident in the continued strong performance of the business.”

Following the update, Craneware shares rallied by almost 14%, up to 2,190p a share. This price is its highest since the first lockdown began, but around 25% shy of analysts’ 2,733.33p target price. Analysts currently have a consensus ‘Buy’ stance on the stock; its p/e ratio of 35.30 is good value versus the tech and computing sector average of 72.15; and it has a 54.39% “outperform” rating from the Marketbeat community.

Funds to watch during the Biden Emerging Market renaissance

Jamie Gordon
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Funds to watch during the Biden Emerging Market renaissance
Speaking ahead of the US election, blue chip investment managers, BlackRock, said that tense competition would continue between the US and China regarding tech, trade and investment. However, they believe a Biden presidency will also herald a return to ‘predictable’ trade and foreign policy, which would support emerging market assets and broader risk sentiment in the short-term. With that in mind, here are two funds that could position investors well for a Biden emerging market renaissance.

Aberdeen Emerging Markets Investment Company Limited

This should hardly come as a shock to many – you type ’emerging markets’ into Google and the Aberdeen Standard parent company comes up ahead of the phrase’s definition. Trading at a price of 637.50p and boasting a NAV of 734.26p, the company offers a discount of 13.2% – the third best of the IT Global Emerging Markets Investment Trusts (GEMITs). Similarly, its 3.45% yield means it ranks fifth out of the GEMIT funds. Meanwhile, its 14.9% one-year price growth, 11.9% three-year price growth, and 78.5% five-year growth see it place fourth, fifth and fourth places respectively. That latter growth, at almost 80% over five years, is almost double the IT GEMIT fund average of 44.2%. Its ability to rank within the top five for each of these fundamentals isn’t just impressive, it makes it the only fund of its kind on Trustnet‘s IT GEMIT ranking. Speaking on its performance in emerging market economies during September, the Aberdeen Emerging Markets Investment Company (LON:AEMC) said in its latest performance analytics: “Aberdeen Emerging Markets Investment Company’s net asset value total return for September was 2.3%. Performance was 0.4% ahead of the MSCI Emerging Markets Index with manager selection the largest contributor as the Company’s investments in Thailand (Ton Poh Fund), Romania (Fondul Proprietatea) and the Neuberger Berman China Bond Fund performed well. Asset allocation was a minor detractor which was largely a consequence of the Company’s underweight position in Taiwan. Discount narrowing across the portfolio’s closed end fund holding had a small positive impact with Fidelity China Special Situations the most notable contributor.” At present, the fund’s largest holdings are in Neuberger Berman China Equity Fund (11.40%), Fidelity China Special Situations (7.70%), and Weiss Korea Opportunity Fund Ltd (7.50%). The fund is also particularly exposed to Eastern Asia, with 38.90% of its portfolio made up of Chinese equities, 12.70% in South Korean equities, and 8.10% in Taiwanese equities.

Templeton Emerging Markets Investment Trust

Another company to consider – for its solid fundamentals and blue chip holdings – is Templeton Emerging Markets Investment Trust (LON:TEM). With a price of 905.00p and a NAV of 1,004.99p the fund is currently operating an effective 9.5% discount – the fifth best in class. Similarly, its 2.09% yield is not to be shrugged off. Where the company comes into its own, though, is its price growth. Ranking in second position with its 19.2% one-year growth, the company places in fourth with 24.2% growth over three years, and second with its 138.9% growth over five years. This latter figure means it grew at more than 300% the average rate of IT GEMITs. Alongside solid price growth, what also appeals about Templeton’s fund is that it’s comprised of some Asian – and global – household names. For instance, 9.30% of its holdings are made up of Samsung Electronics and Alibaba Group respectively, while 8.70% is made up of Tencent Holdings. Its star performance as of late, though, has been its largest holding, in the Taiwan Semiconductor Manufacturing Company (10.50%). Speaking on its Q3 performance, the company said: “Major stock contributors to TEMIT’s third-quarter performance relative to the benchmark MSCI Emerging Markets Index included chip maker Taiwan Semiconductor Manufacturing Company (TSMC), Russian internet company Yandex, and Chinese e-commerce giant Alibaba Group.” Another notable consideration is the fact that Alibaba have shed around 10% off their value in the past two weeks – partially driven by the kafuffle surrounding Ant Group’s IPO – but it’s hard to imagine China’s largest e-commerce platform will have the wind taken out of its sails for long. At present, Templeton is most exposed to equities in ‘Asia Pacific’ (34.10%), South Korean (19%) and Taiwanese geographies (14.60%).

Airbnb posts loss ahead of IPO

Safiya Bashir
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Airbnb posts loss ahead of IPO
Airbnb has revealed a $697m (£527m) loss for the nine months to the end of September. The loss has widened from the $323m loss that was posted for the same period a year earlier. Over the third quarter, the group posted revenues of $1.3bn which was down 18%. Airbnb said: “The recovery in the second and third quarters of 2020 is attributable to the renewed ability and willingness for guests to travel, the resilience of our hosts, and relative strength of our business model.” The fourth quarter is seeing a decline in bookings and cancellations amid lockdown restrictions. The company is preparing for its initial public offering, which is expected to be completed before the end of the year. Airbnb has had a tough year amid the restrictions and in response has announced plans to reduce the workforce by 25% and slash marketing costs. Chief executive Brian Chesky said told employees at the time: “We are collectively living through the most harrowing crisis of our lifetime, and as it began to unfold, global travel came to a standstill. Airbnb’s business has been hit hard, with revenue this year forecasted to be less than half of what we earned in 2019.”      

Imperial Brands forecasts better 2021 profits, shares rise

Safiya Bashir
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Imperial Brands forecasts better 2021 profits, shares rise
Imperial Brands shares (LON: IMB) were up over 3.5% on Tuesday after the group full-year results for the year ended 30 September 2020. The tobacco company forecast better profits for 2021 as the group expects stronger demand in its e-cigarette business, which decline in 2020 amid certain US bans. The group reported an increase in revenue by 0.8% to £7.99bn. Stefan Bomhard, the chief executive, said: “Although this has been a difficult year, the resilience of our tobacco business and the measures we have taken to improve our NGP operations reinforce my confidence in the future potential of the business. With a more disciplined focus and better execution we can realise significant value for our stakeholders over time. “My first months have been focused on engaging with employees, consumers and customers and leading the strategic review of the business. What I have seen to date confirms my view of the Group’s solid foundations. I believe there is scope to enhance returns from our tobacco business and opportunities to strengthen our NGP delivery over time. I firmly believe we can make a meaningful contribution to harm reduction within a more disciplined, returns-focused framework and we have already taken steps to stem the NGP losses.” Imperial Brands shares (LON: IMB) are +3.28% at 1.448,50 (0936GMT).

Homeserve shares rise on +17% H1 revenue

Safiya Bashir
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Homeserve shares rise on +17% H1 revenue
Homeserve shares (LON: HSV) were up on Tuesday morning after the group reported strong first-half results. The FTSE 100 company posted a 17% increase in revenue from £457.7m to £536.7m. Statutory profit before tax, however, fell 49% to £10.1m. Richard Harpin, the founder and chief executive, commented: “What HomeServe stands for – making home repairs and improvements easy – has never been more important. The stresses of living and working through a pandemic mean that we are all more aware than ever of the value of home comforts. Our strong policy retention in the first half underscores the value our Membership customers place on the service we provide. “Against this challenging backdrop, I am really pleased that the business continues to perform well. As we go into the busy winter months, our focus continues to be on delivering great service for our customers and a secure livelihood to our teams and trades. The latest wave of lockdowns has made no fundamental difference to our operations, and the good news for us and our customers is that engineers can continue to work in peoples’ homes. Based on what we see today, we are confident of delivering a healthy mix of organic and acquired revenue growth at the full year, with profits ahead of our prior expectations.” Looking forward, the group said that it continues to expect strong demand and has increased profit forecasts for the full year. Homeserve shares (LON: HSV) are trading up almost 3% at 1.273,80 (0849GMT).

Easyjet swings to red and posts £1.2bn loss

Safiya Bashir
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1
Easyjet swings to red and posts £1.2bn loss
Easyjet (LON: EZJ) has posted its first-ever full-year loss, sinking £1.2bn into the red. For the year ending 30 September, the budget airline saw passenger numbers half from 96.1m to 48.1m amid travel restrictions and social distancing measures. Easyjet also said that it will only fly at 20% capacity for the first quarter of the next financial year. Revenue 52.9% to £3bn, which was down from last year’s revenue of £6.4bn. Commenting on the results, chief executive Johan Lundgren said: “I am immensely proud of the performance of the easyJet team in facing the challenges of 2020. We responded robustly and decisively, minimising losses, reducing cash burn and launching the largest Cost Out and restructuring programme in our history – all while raising more than £3.1 billion in liquidity to date. “easyJet has not only withstood the impact of the pandemic, but now has an unparalleled foundation upon which to emerge strongly from the crisis. Our unmatched short haul network and trusted brand will see customers choose easyJet when returning to the skies. “While we expect to fly no more than 20% of planned capacity for Q1 2021, maintaining our disciplined approach to cash generative flying over the winter, we retain the flexibility to rapidly ramp up when demand returns. “We know our customers want to fly with us and underlying demand is strong, as evidenced by the 900% increase in sales in the days following the lifting of quarantine for the Canary Islands in October. We responded with agility adding 180,000 seats within 24 hours to harness the demand.” Since the vaccine news, shares in Easyjet have surged and bookings have grown by 50% since the news. Easyjet shares (LON: EZJ) are down 2.57% at 757,60 (0817GMT). Over the past month, shares have increased from lows of 494,40.

Moderna vaccine news sees FTSE soar and value stock recovery continue

Jamie Gordon
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Moderna vaccine news sees FTSE soar and value stock recovery continue
The FTSE was among the biggest index winners on Monday, led by a surge in the previously COVID-stricken equities, as Moderna (NASDAQ:MRNA) announced that its vaccine candidate had a 94.5% efficacy rate. Logistical issues will remain an ongoing concern going forwards. However, the Moderna vaccine doesn’t require the same extreme cold storage as its Pfizer counterpart, and the UK successfully placed an order for 5 million units on the day of the results publication, taking its total vaccine units to 35 million. Even with these facts being true, mass roll-out will remain a challenge. As stated by Kingswood CIO, Rupert Thompson: “Mass inoculation therefore looks unlikely before next summer. There is also the additional complication that while 80% of the population is supposedly willing to be inoculated in the UK, it is no more than 60% or so in the US.” Similarly, infections have picked up in the US, and average daily infections increased from just over 22,000, to more than 25,000 in the UK. With lockdown part 2 now in full swing across European nations, a double dip recession now looks to be on the cards, with the economic activity stifled during the fourth quarter. Despite the medium-term risk factors, the FTSE chose to chase the good news on Monday, up by 1.66% as trading closed. Up to 6,421 points, the index now stands at its highest level since the start of June. Already pricing in the harmful effects of a second wave in the week leading up to the US election, global equities managed to cling onto short-term excitement and long-term hope, and replicate the trends posted on the previous Monday. Mr Thompson adds: “If the sunlit uplands are visible on the horizon, investors are usually prepared to look through any short-term troubles.” Outside the FTSE, the CAC rallied by 1.7%, the DAX rose by 0.5% and the Dow Jones hiked 1.3%. In particular, though, there are two trends worth looking at – prospects are significantly brighter for stocks than bonds, and with 7% growth last week, the FTSE will likely remain the location of notable equities recoveries in coming months. On the latter, IG Senior Market Analyst, Joshua Mahony, said: “Once again we are seeing value outperform, to the benefit of the FTSE 100. With names such as Cineworld, IAG and Rolls-Royce all pushing sharply higher, there is a feeling that last week’s Pfizer announcement has provided a huge boost in confidence for traders to shift towards some of the hardest-hit stocks.” “With over a quarter of the FTSE 100 attributed to energy and financial stocks, the prospect of an extended vaccine-led recovery does highlight the potential for UK market outperformance.”  

More than half consider housing crisis to be a major UK issue

Bronte Carvalho
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More than half consider housing crisis to be a major UK issue
New research commissioned by bridging finance provider Market Financial Solutions (MFS) has outlined the growing concern over the UK’s housing crisis, with more than half of Brits considering it to be one of the biggest issues even amidst the Covid-19 pandemic and ongoing Brexit uncertainty. The MFS survey – conducted across an independent, nationally-representative survey of 2,000 UK adults – found that 51% of Brits consider the housing crisis to be one of the main issues facing the UK, with 62% asserting that housing policy has been “neglected” by successive governments. Concerningly, only 17% of Brits know who the UK Minister for Housing is. For the sake of clarity, Conservative MP Robert Jenrick currently holds that position. Earlier this year, Chancellor Rishi Sunak announced a stamp duty holiday for properties valued at less than £500k as part of his July “mini budget” to boost the UK economy. Analysis by Zoopla predicted that consumers could save up to £1.3 billion in stamp duty payments, with savings of up to £14,999 for first time buyers. However, new figures from Rightmove have pointed to another housing market dip on the horizon, as sellers rush ahead of the stamp duty holiday deadline in the spring. Tim Bannister, Rightmove’s director of property data, commented on Monday: “Given the ongoing mini-boom, prices might have been expected to rise again this month. “But instead we have a slight dip, which could be a result of some new sellers pricing more realistically to have a better chance of agreeing a sale in time to benefit from the stamp duty savings on their onward purchase”. Nevertheless, the MFS survey found that 49% of Brits are currently “satisfied” with Sunak’s Covid-19 support and stimulus packages so far. Paresh Raja, CEO of MFS, insisted that the government still needs to do more to address the mounting problems in the housing market, stating: “Over the coming months, the government must focus on the housing crisis. However, it is also up to those involved in the property market – lenders, estate agencies and brokers – to ensure they are doing everything in their power to help prospective homebuyers”.  

Third of Brits still rely on cash for essential shopping

Bronte Carvalho
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0
Third of Brits still rely on cash for essential shopping
New research by travel cash provider Bidwedge has revealed that almost a third of Brits still rely on cash for essential shopping, even as UK retailers opt for card-only payments over concerns that coins and notes could aid the transfer of infectious Covid-19 particles. The survey – conducted across 2,083 UK adults – found that 32% of Brits (roughly 15,570,000 people) still prefer to use cash for their essential shopping and goods despite nationwide efforts to prioritise card payments. An additional 60% of adults – around 28,820,000 Brits – also said that they try to have some cash on their person at all times as it helps them to feel more “financially secure”. When it comes to holidays, 55% of Brits (17,780,000 people) said that they would still be utilising cash as their main payment method, while 13% of Brits (a small but significant 5,476,000) say that cash is “essential to their livelihood” and prefer for their income to be paid in cash. Shon Alam, CEO of Bidwedge, commented on the research: “Despite all the calls from people to use cards, cash is still incredibly important to millions of Brits across the country. Communities rely on cash and for businesses, it is cheaper for them to process cash rather than card payments, so it actually can help thousands of firms that are struggling right now”. Earlier this year, the World Health Organisation made headlines for appearing to dissuade people from using cash during the peak of the coronavirus pandemic. The institution’s Cash Task Team published guidance in April advising anyone who comes into contact with cash to practice rigorous personal hygiene to minimise the risk of infection: “Contact-less electronic or mobile payments should be the preferred option to reduce the risk of transmission. Where this is not possible, those handling cash should adhere to the basic preventive measures […] regular handwashing and avoid touching of the mouth, nose, or eyes when having been in contact with any surface that can potentially be contaminated”. This advice was issued during the first wave of the pandemic, when information about the nature of Covid-19 was still sparse and general advice tended to err on the side of caution. Alam nevertheless warns that there is still little room for complacency, and offers some tips on how to use cash safely during the pandemic: “Most phone and tablet wipes will disinfect our new plastic notes quickly and, following guidance from the World Health Organisation, remember to wash your hands after handling physical money and don’t touch your face. “Many cash dispensers are disinfecting money before it comes out of the wall, so try and find cash point that is doing this and try and pay as close to the total sum to avoid receiving too much change and passing on unnecessary coins”.  

Gold could hit $2800 as uncertainty persists in 2021, says Direct Bullion

Jamie Gordon
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Gold could hit $2800 as uncertainty persists in 2021, says Direct Bullion
British precious metals dealer, Direct Bullion, stated on Monday that it believes the gold price will ‘break new records in 2021’, with lingering economic uncertainty driving demand for the commodity in the new year. Despite a predicted 9% increase in production in 2021, Metal Focus expects gold to remain high, and above $2,000 per troy ounce. Blue Line Futures has forecast a ceiling of $2,500 by December 2021 and Goldman Sachs recently raised its 12 -month gold forecast to $2,300 per ounce. Far ahead of these projections, though, Direct Bullion says that its research indicates a gold price increase of as much as 40%, with the potential to hit $2,800 per troy ounce over the first six to seven months of 2021. Not settling for gold adding a tremendous amount to its price, Direct Bullion also predicts that platinum might also ‘surge’ in the new year, with the metal playing a ‘pivotal role’ in the global shift towards sustainable fuels, as precious metals act as a catalyst for hydrogen fuel cells. Acting as testament to this fact, Hyundai announced in October that it plans to use around 70,000 ounces of platinum per year in its fuel cell stacks by 2030 – with this demand alone being equal to the total annual production of one of South Africa’s biggest platinum mines Speaking on gold prices, and the demand for precious metals in the new year, Paul Withers, CEO of Direct Bullion, said: “Next year looks to be exciting for the precious metals market, particularly for platinum , silver and gold. With the gold price potentially reaching highs of up to $2,800, there has never been a better time to invest in physical gold as a safe haven asset.” “The security provided by investment in physical materials is an attractive proposition to investors looking to avoid possible market volatility. We often hear our customers saying, ‘I wish I had bought more!’.”
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