Watchlist 18th May 2022

Watchlist 18th May 2022

May 18, 2022

I currently have around 20 items on my watchlist and thought I would post about the top three.

This list does change as I read company updates and shares are deleted, purchased, added to or sold off, so please don’t copy my ideas as by the time you read this they could and probably will be out of date from my research, always DYOR (Do your own research)

In no particular order and my research is undertaken mainly with Stockopedia

  1. Pets at Home - Ticker Symbol PETS
    I like this for many reasons listed below
    Owners love their pets
    Their online presence is growing
    They are now running subscription services
    They make the most of the stores space by having mezzanine floors for Vets and Groomers
    Expanding revenues by Pet Sitting, Insurance, Pet Clubs

    The membership of their VIP loyalty card is growing as is the marketing activity
    Competitively priced having got their act together

    The trade on a low PE currently 12.7 (less than my maximum of 20)

    They have a dividend yield of 4.07% covered 2 times by earnings
    They are at the lowest price per share since September 2020
    There is a new CEO Designate as 25th April 2022

    I am watching the share price, and looking for it to break out with volume to the upside which should enable me to take an opening position.

    Depending on what the chart tells me, I may look to buy before the FY22 Preliminary Results on the 25th May, which is not long to go, maybe wise to wait until they are announced as an RNS if they are not so good the price will fall, if they are good the price may spike so I may wait a day or two after the results to make a final decision

  2. Macfarlane - Ticker Symbol MACF

    This is in a growth industry, packaging which is well suited for online sales, the amount of online sales is growing exponentially, and Macfarlane are one of the leading companies manufacturing the packaging supplies.

    They have grown by acquisition

    The PE ratio is a lowly 10.4

    A dividend is currently at only 2.95% but is covered nearly 3 times and other than the pandemic year, the dividend has increased year on year.
    One other thing I like is there has been Director buying and not selling which can indicate confidence in the business.

    The share price is fairly dull and is currently at around £1.20 which in my mind is not a bad entry price, but it does seem to bounce of £1.15 and I have set an alert for this level.

    My target for this is £1.50 so around a 30% return from my target price, and my stop, or get out price would be around £1.05

  3. Volex - Ticker Symbol VLX

    The attraction for me here is, they are the worlds leading producer of cables and in particular for charging electric vehicles.
    Also provide cabling for medical equipment and datacentres, critical components
    To support this they are growing by acquisition having announced another takeover this week.
    The Executive Chairman Nat Rothschild also purchased more shares this week and his holding company NR Holdings now owns 24.53% of the company, now that shows commitment and confidence.

    The dividend yield is a little low at 1.43%, however the capital growth as they are at the lowest price since October 2020 should be significant
    Currently the share price is £2.59 and I am expecting it to rise to £4.50 over the next 12 months, giving a nice growth, I may add along the way

    The PE is only 11.3
    The dividend is covered over 5 times, so they could pay out more, but are acquiring businesses to add to the growth which is fine

    I think this will be enough for now, as I can get carried away, so please use this as your starter for further research if you are interested

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