This morning’s Interim Results from the Aquis-quoted One Health Group (AQSE:OHGR) should inspire investors enough to be tucking a few of its shares away right now.
One Health Group utilises specialist consultants and healthcare managers working together to provide the best possible diagnosis and treatment for its patients.
It is an independent provider of free, high-quality NHS care for patients referred through 'Patient Choice' for treatment in Orthopaedics, Spine, General Surgery and Gynaecology.
The selling that rocked global equities post-Fed yesterday continued on Friday, with European indices falling in the early hours of trade.
US stocks faced another choppy session on Thursday as traders grappled with the idea the Federal Reserve will be in no rush to cut rates next year and the pace of rate cuts will be slower than many hoped.
“The post-FOMC yo-yo price action persisted yesterday, as participants continued to digest Powell & Co’s hawkish 25bp cut on Wednesday, though a decent chunk of the market moves seen during the decision itself pared as yesterday progressed,” said Michael Brown Senior Research Strategist at Pepperstone.
“As so often tends to be the case, markets had shifted to a hawkish extreme amid Powell’s remarks, before then gradually edging back from said extreme as the dust settled, and calmer heads prevailed, yesterday.”
The dust was still settling in London on Friday as the FTSE 100 sank another 0.6% in midmorning trade.
“The FTSE 100 was sharply lower again on Friday, dragged down by water utilities and banks after uneven trading in Asia and the US overnight,” said AJ Bell investment director Russ Mould.
“In a sign of risk-off sentiment, cryptocurrency bitcoin slipped below the $100,000 mark.
“A marginal rise in November retail sales was not helped by the fact Black Friday fell outside of the ONS November reporting window this year. Investors in the sector will be hoping there has been a last-minute rush through December as people loosened their purse strings ahead of Christmas.”
The selling was broad, with only around 10 shares trading in positive territory at the time of writing.
Severn Trent and United Utilities were the top fallers after Goldman Sachs slashed their price targets. Severn Trent lost 2.3% and United Utilities dropped 2.6%.
There was mild positivity in retailers Marks & Spencer and Sainsbury’s, but the impact on the index of their gains was a drop in the ocean compared to selling elsewhere.
There is still time for the seasonal rally to kick in, but the FTSE 100 has a long way to go to produce positive returns for the month of December.
Tekcapital portfolio company Guident has announced a fresh patent to bolster its IP portfolio as it gears up for an IPO in 2025.
Guident has been granted European patent (No. 4097550) covering AI-powered remote monitoring and control center (RMCC) system for autonomous vehicle safety management.
The patented technology enables distributed sensor fusion across multiple autonomous vehicles, including those not directly under RMCC control. This allows the system to assess incident risk levels in real-time and take control of vehicles operating at unsafe risk levels, implementing safety measures until conditions return to normal.
Guident has already established a commercial-grade remote monitoring facility in Florida, with additional centres planned for Michigan and Europe, positioning the company at the forefront of AV safety infrastructure.
“We are very excited about the recent patent and commercial progress of Guident,” said Harald Braun, Executive Chairman of Guident.
“We believe the timing for Guident’s potential IPO next year is excellent and our experience with remote monitoring and control coupled with our proprietary intellectual property provides a first mover advantage.”
The automotive active safety systems sector, including driver monitoring, projected to reach over $25 billion by 2030 and is showing signs of heating up with players including Tesla, Waymo, and WeRide ramping up activities and closing substantial funding rounds.
Safety infrastructure remains crucial for widespread AV adoption, with stakeholders across the spectrum – from consumers to government regulators and manufacturers – prioritising safety measures. Guident’s patent and expanding operational footprint suggest the company is well-positioned to address these critical industry needs.
Guident’s RMCC technology could be vital in building public trust and ensuring regulatory compliance as autonomous vehicles transition from limited trials to mainstream deployment.
Investors will look forward to Guident’s IPO in 2025, which could value the company at more than Tekcapital’s entire market cap if recent IPOs of similar companies are used as a guide.
IP Group plc expects to receive £13.8 million in total proceeds from cash offers for two of its life sciences portfolio companies, with approximately 20% of the proceeds earmarked for expanding its share buyback program.
The first offer comes from Surgical Science Sweden AB for Intelligent Ultrasound Group plc, valued at £45.2 million. IP Group’s 20.8% stake will generate £8.8 million in proceeds, representing a £4.4 million (100%) increase from its last reported value in June 2024. This cash offer supersedes a previously planned distribution from the sale of Intelligent Ultrasound’s AI business.
The second offer involves Pharming Technologies BV’s bid for Abliva AB, a mitochondrial disease treatment developer, valued at SEK 725.3 million (£52.4 million). IP Group’s 9.5% holding is expected to yield £5 million, marking a significant £3.7 million (284%) increase from its June 2024 valuation and delivering 1.5 times the original investment cost.
Both transactions remain subject to standard closing conditions and necessary approvals, with IP Group committed to providing updates upon completion of each deal.
“We’re pleased to see continued interest in our life sciences portfolio following the successful sale of Kynos Therapeutics in October. Our congratulations go to Stuart Gall and the Intelligent Ultrasound team and to Ellen Donnelly and the team at Abliva,” said Greg Smith, Chief Executive of IP Group.
Herald Investment Trust (LON: HRI) says the requisition notice from Saba Capital Management is valid. The US hedge fund believes that the investment trust has underperformed and wants to replace the board and appoint two new directors.
Saba Capital Management has acquired a 19% stake in Herald Investment Trust. It previously owned 4.9%. A general meeting date will be set.
This is one of seven investment trusts targeted by Saba Capital Management. The others are Baillie Gifford US Growth Trust (LON: USA), CQS Natural Resources Growth & Income (LON: CYN), Edinburgh Worldwide IT (LON: EDIN), European Smaller Companies Trust (LON: ESCT), Henderson Opportunities Trust (LON: HOT) and Keystone Positive Change IT (LON: KPC).
The argument is that all these investment trusts have underperformed and have discounts to NAV that the US hedge fund believes is too high. The boards are not perceived to have done enough to improve this. Saba Capital Management believes that it has the expertise to
Herald Investment Trust, which invests in smaller, international technology companies, had net assets of £24.7849 on 18 December. The investment trust has outperformed the Deutsche Numis Small Companies Index, including AIM, and the Russell 2000 Tech Index over its 30-year history. NAV has risen by nearly 2,500% since incorporation. No dividend has been paid since 2012.
The Herald Investment Trust share price has fallen 40p to £24.40. The discount to NAV is just over 1%.
Leading investment trust fund managers have revealed their top stock selections for the coming year.
Ranging from a leading consumer healthcare business to Vietnam’s top technology company, investment trust managers share some of their best ideas for the new year with UK Investor Magazine readers.
Ian Lance, Fund Manager, Temple Bar Investment Trust
Marks & Spencer’s (M&S) has seen a few ups and downs over the last twenty years, but its most recent renaissance began in earnest in 2017 with the appointment of Archie Norman as chairman. Having previously turned around Asda, Norman set about overhauling half of senior management, modernising the store footprint and refreshing clothing lines to attract younger customers. In food, the company retained its premium appeal while expanding to cater for weekly shops. Meanwhile, a long-overdue digital strategy has transformed M&S into one of the UK’s leading online retailers. These changes, combined with £300 million in annual cost savings, have set the stage for success.
By 2023, M&S was gaining market share in food and clothing, with earnings exceeding expectations. The share price has surged from £1 in late 2022 to touch £4 in recent weeks, yet we see further upside, as the company’s long-term earnings potential remains undervalued.
IAG (LON:IAG)
IAG is one of Europe’s “big three” airline groups, with a strong presence across passenger, cargo, and loyalty businesses, and through its partnership with American Airlines, a particularly dominant position in the highly profitable transatlantic market.
With a high-quality management team and a strengthened balance sheet, we believe IAG’s shares are presently undervalued. The company has consistently delivered strong and growing profitability both before and after the Covid pandemic. Trading on just 6x earnings and offering a free cashflow yield of over 10%, the shares appear compellingly valued. Meanwhile, with the dividend reinstated at the company’s recent interim results, shareholders look set to be well rewarded in the years ahead.
Craig Martin, Chairman, Dynam Capital, the manager of the Vietnam Holding Investment Trust
FPTis a leading IT services provider in Vietnam, with a market capitalization of USD 7.6 billion as of August 30, 2024. Over the years, FPT has positioned itself as a key player in high-growth sectors, underpinned by its strong focus on technology, global expansion strategy, and diversified business model encompassing IT services, telecoms, and education. The company is also a well-known distributor and retailer of IT products and a key player in the education sector, with programs spanning multiple levels for 145,000 students nationwide.
In 2023, the company achieved a profit before tax (PBT) of USD 430 million and generated overseas IT service revenues of USD 1 billion. With a commitment to innovation and leveraging digital transformation trends, FPT continues to expand its global footprint, including notable success in the Japanese market. The company currently operates across more than 30 countries and territories. This extensive international network enables FPT to deliver diverse IT services and solutions globally, serving clients in sectors such as automotive, finance, and healthcare. The company has successfully transformed itself from an IT outsourcing service provider to an end to-end digital transformation partner.
FPT’s ability to combine on-the-job training with academic excellence, focus on innovation, and strategic investments in global markets positions it as a long-term growth story in Vietnam’s technology and education sectors.
Mobile World Investment Corporation (MWG: HOSE)
“Founded in 2004 as a single store selling mobile phones, MWG has grown to become Vietnam’s largest retailer by revenue and physical store count, now exceeding 5,000 locations. MWG operates under several brands, offering a wide range of merchandise, including consumer electronics, groceries, and pharmaceuticals. As of the end of 2023, the company employed over 60,000 people.
As a modern-trade consolidator, MWG has revolutionised the Vietnamese retail landscape by continuously expanding its footprint, exploring new formats, and diversifying product offerings to meet evolving consumer needs. MWG now commands over 50% market share in mobile phones and consumer electronics, while its grocery chain ‘Bach Hoa Xanh’ has recently become the market leader in terms of revenue. In addition to its core brick-and-mortar business, MWG has been enhancing its e-commerce capabilities to respond to the growing trend of online shopping in Vietnam. The company has invested significantly in its online platforms and logistics infrastructure to better serve customers and compete with other major e-commerce players in the market. Online revenue accounted for 14% of total revenue in 2023, with a transaction value of USD 700 million, positioning MWG among the top e-commerce players in Vietnam. The company’s omni-channel approach, supported by its extensive store network, fast delivery, and customer-centric culture, is a key competitive advantage.
MWG’s innovative approach to retailing, robust market position, and strategic diversification make it a compelling choice for investors seeking exposure to Vietnam’s retail sector. Its ability to adapt to consumer trends and capitalize on untapped opportunities underscores its potential for sustained value creation.”
Gervais Williams, Fund Manager, The Diverse Income Trust plc
AO World (LON:AO)
“Unfortunately, we are working on the assumption that 2025 will be an unsettled year, marked by rising unemployment due to the National Insurance increase, along with US tariffs that interrupt global trade. In a tough market, typically the strong become stronger, whilst the weak lose out. AO World is, in our view, a strong supplier of household electricals. Specifically, we believe AO.com’s Five Star Membership scheme could become the consumer route of choice when buying household electricals. Additional market share should help drive extra efficiencies, and hence support AO’s cash generation. Ultimately, it’s those generating extra surplus cash that hold all the aces in tough periods.”
TP ICAP (LON:TCAP)
“In our view, TP ICAP, is a leading provider of liquidity to the global credit markets, at a time when global markets are highly volatile. Furthermore, as it networks its Liquidnet platform with the global banks in 2025, we believe its market position should further improve. Alongside, they are looking to bring in a new investor into their Parameter data subsidiary. In short, we believe all this should help drive up their cash generation. Not at all bad for a company standing on a current dividend yield of 5.6%. As with AO, in our view, the strong companies should get stronger, and TP ICAP appears very well placed for 2025.”
Charles Luke, Fund Manager, abrdn Murray Income Trust
“We believe that Haleon, a leading consumer healthcare business, is an attractive investment. The company has powerful market positions across five major consumer healthcare categories benefitting from strong and well-known brands. These five categories are Oral Health (with brands including Sensodyne), Vitamins, Minerals and Supplements (Centrum), Pain Relief (Panadol), Respiratory (Flonase) and Digestive Health (Tums). Revenues are globally diversified and around 30% of revenues derive from faster growing emerging markets. Attractive long-term drivers include ageing populations, a greater consumer focus on health and wellness and a sizeable unmet need (around 40% of adults suffer from gum disease but don’t use a specialist toothpaste like Sensodyne). Other attractive characteristics of consumer healthcare include limited private label competition, a relatively low level of cyclicality and relative price insensitivity. Haleon’s medium term financial guidance is to grow its revenues organically between 4-6% and to generate operating profit ahead of this which should lead to appealing dividend growth.”
Rotork (LON:ROR)
“Rotork is a leading global manufacturer of actuators. The company offers attractive growth potential from a variety of different drivers: methane reduction in upstream oil and gas; robust oil and gas capex budgets; and scope for growth in water and CPI (chemicals, process and industrial) specialist segments which should lead to revenue growth of at least 5-7% per annum. The company has strong quality characteristics with attractive margins, a high return on capital employed, market leading positions, high barriers to entry (for example its strong brand, high performance and reliability, the requirement for certification, and provision of field service) and a net cash balance sheet. The company has an appealing part to play in the energy transition helping to remove methane emissions and is well placed to enable the growth of hydrogen and carbon capture and storage. We don’t believe that the company’s strong competitive position and attractive growth potential is reflected in its valuation.”
“A significant position in the portfolio is London Stock Exchange Group. LSEG is significantly diversified beyond just owning the London Stock Exchange. It is a global financial markets infrastructure and data provider serving customers across financial markets. It has mostly recurring revenue and 50%-plus margins. Its capabilities include data, indices and analytics, trade execution, clearing and risk management products and services. Its customers include a wide range of financial market participants, and increasingly corporates, who use the data for decision-making. LSEG’s data set is deep, broad, exceptionally difficult to replicate, and a significant and enduring source of competitive advantage.”
RELX (LON:REL)
“Another position we have been building up over the year is RELX. This company provides information-based analytics and decision tools for professional and business customers in sectors including risk; scientific, technical and medical; legal; and exhibitions. For example, RELX owns Elsevier – a leading global scientific publisher which alongside publishing high impact journals such as The Lancet, also provides data analytics tools. RELX has delivered an improving trajectory of both revenue and earnings growth, as the business has shifted towards higher growth analytics and decision tools. The company’s approach is to price new and improved tools according to the value provided to customers. Its philosophy is to adopt a long-term approach, partnering with customers to deliver added value.”
Global equities sank on Thursday after the US Federal Reserve delivered a ‘hawkish cut’ to interest rates, sending a wave of disappointment through financial markets.
The Bank of England helped stem the selling with hints of rate cuts in the new year, despite keeping rates on hold at 4.75%.
So much for a Santa rally.
The FTSE 100 shed 1% in early trade after the Federal Reserve cut rates by 25bps to 4.25% – 4.5%. After being accused of moving too slowly to make their first cut after the hiking cycle, the Federal Reserve has now slashed rates by 1% since September.
Selling picked up as the session progressed before the Bank of England’s rate decision and accompanying commentary helped spark a small rally from the lows in the FTSE 100. The index was down 1.1% at the time of writing.
“European markets posted sharp losses in early trading,…tracking a global selloff sparked by the US Federal Reserve’s hawkish shift,” said Matt Britzman, senior equity analyst, Hargreaves Lansdown.
“While the Fed delivered a widely expected 25bps rate cut, its projection of just two cuts in 2025 – down from four in September – rattled investors around the globe.”
As we mentioned earlier in the week, traders would be unphased by the actual decision and would be more concerned about the Federal Reserve’s policy projections for next year.
Stubbornly high inflation and the surprising resilience of the US economy were behind the Fed’s revised borrowing cost projections, which now see fewer rate cuts next year.
“US markets played the part of Scrooge on Wednesday, tumbling as the Federal Reserve’s hawkish tone dampened holiday cheer, with the S&P 500 shedding 2.95%, the Nasdaq sliding 3.62%, and the Russell 2000 plunging 4.46%,” Britzman explained.
“The Fed’s latest 25bps rate cut was as expected, but policymakers signalled just two cuts for 2025 – half of what was anticipated last quarter. This shift sent the 10-year Treasury yield up 11 basis points to 4.51%, adding further pressure to equity markets. Wall Street’s reaction underscores the Fed’s delicate balancing act as it tightens its outlook on easing, forcing markets to recalibrate their rate expectations. Investors should see this as a healthy spot of profit-taking rather than an end to the party, after what’s been a fantastic run for markets since the US election.”
The Federal Reserve’s interest rate decision was followed by the Bank of England’s interest rate decision to keep rates on hold, voting 6-3 in favour of keeping rates on hold.
Bank of England
Governor Bailey provided little insight into when the Bank of England would cut again, but comments about wages and slow growth gave a dovish tone to accompanying commentary.
“It remains highly likely the Bank will continue to follow its data dependent path and cut rates in the New Year, perhaps as early as its first meeting in February, but we expect only a gradual withdrawal of more restrictive policy over the course of 2025,” said Rob Morgan, Chief Investment Analyst at Charles Stanley.
The BoE rate decision and insight provided some reprieve for UK stocks, but cyclical sectors, including miners, banks and financials, remained in the red.
Housebuilders spiked higher after the rate announcement, with Persimmon jumping 1.3% in seconds.
Intermediate Capital Group was the top faller, falling 4%, despite receiving a price target upgrade.
Although investors are clearly upset with the new trajectory for interest rates, the earnings picture for US stocks still looks strong. Today’s dip may prove to be a buying opportunity for US stock once the dust settles.
The UK’s outlook is slightly less clear, with questions being asked about government policy and sentiment on the floor. That said, uncertainty such as this can be a precursor for a rally.
Active Energy Group (LON: AEG) shares rose a further 37.1% to 0.24p. Zen Ventures provided a loan of £200,000 to enable the publication of 2023 accounts and the latest interims. Zen Ventures will appoint two directors. The plan is to commercialise the CoalSwitch technology.
Sabien Technology (LON: SNT) says Phoenix, Arizonia will be the place of the first deployment of its waste plastics to oil technology. Phase 1 of the project will involve two pilots, and this will last for five years. Sabien Technology’s non-consolidated associate company b.grn Group has signed a non-binding letter of intent for leasing land for the plant. The share price increased 24.4% to 12.75p.
Data and marketing services provider Jaywing (LON: JWNG) revealed interim revenues falling 15% to £9.45m. The loss increased to £2.54m. The main decline was in UK consulting. Cost savings and new business wins man that the second half should be much better. Cash is tight, but there should be an improvement in cash generation. The share price is 18.5% higher at 1.6p.
Surgical Science Sweden is bidding 13p/share to Intelligent Ultrasound (LON: IUG), which values the ultrasound simulation company at £45.2m. The bid is recommended by the board. Intelligent Ultrasound will benefit from becoming part of a larger group and it enables the bidder to obtain a UK operation. Intelligent Ultrasound was going to return cash to shareholders following the sale of its clinical AI business. There was cash of £39.6m in November, which covers most of the bid value. In November 2022, a placing and subscription raised £5.2m at 9.25p/share. The share price improved 13.5% to 12.625p.
PipeHawk (LON: PIP) has made a good start to the financial year and it should return to profit. All the continuing engineering and electronics businesses are doing better. Interim revenues of continuing operations will be significantly ahead of the £1.1m achieved last year and breakeven is expected. The share price is 12.5% ahead at 2.25p.
FALLERS
Yesterday, shareholders approved plans for Webis (LON: WEB) to lave AIM and this will happen on 3 January. The share price dipped by two-fifths to 0.075p.
Gfinity (LON: GFIN) says that it achieved monthly profitability in November. Accounts for the year to June 2024 have been delayed and will not be published by the end of 2024, so trading in the shares will be suspended on 2 January. The share price fell 25.8% to 0.0575p.
Tribe Technology (LON: TRYB) shares are 13.9% lower at 1.4p after revealing that its accounts will be delayed. The autonomous mining equipment developer is in talks with potential provider of finance, and it believes that leaving AIM will make it easier to raise money. Trading in the shares will be suspended on 2 January.
Orosur Mining (LON: OMI) has raised £1.25m at 6.6p/share and this will fund drilling at the Pepas gold project in Colombia. A further 1.9 million broker warrants exercisable at 6.6p/share. The company has identified a basement fault that provides a marker for the trend of the Pepas gold project. The share price slipped 10.2% to 7.9p.
A poor performance in the Falkland Islands hit interims from FIH Group (LON: FIH). This was mainly due to delays to a contract to build houses for the Falkland Islands government and he Ministry of Defence. The problems are set to continue in the second half. The Momart and Gosport ferry businesses were steady. FIH slumped into a loss of £5.9m. Net debt is £3.3m and there is a 1.25p/share interim dividend. The share price declined 8.33% to 220p.
Ex-dividends
MS International (LON: MSI) is paying an interim dividend of 5p/share and the share price is unchanged at 940p.
The UK Investor Magazine was thrilled to welcome Kevin Limn, CEO of Adsure Services, to run through the business assurance specialists’ half-year report.
Adsure Services delivered stellar performance during the half-year period. Revenue grew 19%, driving gross profit 46% higher. The most important takeaway for investors was a 60% increase in the interim dividend.
We explore the factors driving higher sales and how Adsure Services delivers on its growth strategy.
Kevin finishes by highlighting what investors can look forward to in 2025.
Following this morning’s Trading Update, we now know that the AIM listed independent specialist finance provider Time Finance (LON:TIME) has been doing better than the market has been expecting in its six months to end-November.
Following fourteen quarters of growth in its lending, the company has reported a record lending book, record first-half revenues and record Interim profits.
The Business
Time Finance helps UK businesses thrive and survive through the provision of flexible funding facilities.
It offers a multi-product range for SMEs concentrati...
