Looking at both Loungers and the Portmeirion Group

Loungers (LON:LGRS) – interims next Wednesday

In the middle of next week this £200m café/bar/restaurants group will be announcing its interim results for the 24 weeks to 2 October – I will be very interested to see just how well the group has progressed in its first half of the year.

Now with some 175 Lounges and 35 Cosy Clubs across the country, this company has apparently been outperforming the market.

In the period to be reported the company is expected to show that its flexibility and efficiencies have helped it to manage operating hassles created by cost inflation.

The question is will its new openings programme slow down in the balance of this trading year to end April 2023?

Analyst Anna Barnfather, at the group’s joint brokers Liberum Capital, has a Buy rating on the shares.

She is estimating group takings to increase from £237m to £276m, while pre-tax profits could well halve from £21.6m to just £11.4m for the year, halving earnings to 8.6p (17.1p) per share.

However, for the coming year she sees £324m sales, £15.6m profits and 10.6p earnings.

Do her guesstimates actually point to an overpriced situation?

Even though the highest price the shares have achieved, which was 295p in May last year, Barnfather’s price objective is 400p for the shares, which currently trade at only 192.5p.

Perhaps holding steady in front of the half-timers is appropriate.

(Profile 03.09.19 @ 205p set a Target Price of 275p*)

Portmeirion Group (LON:PMP) – setting a new Target Price

The high-quality homewares group could prove to be a beneficiary of good Christmas sales over the next few weeks.

We now know that the trading for both September and October proved up to management expectations. Just how well it has progressed this month is another question, especially with so much turmoil out there in the ordinary shopper’s world.

I am a fan of the group’s various brands – particularly its Royal Worcester, Spode and actual Portmeirion pieces of pottery.

We will have to wait until mid-January to establish trading successes, which is when the 2022-year Trading Update should be announced.

Analyst Sahill Shan at Singer Capital Markets rates the £41m group’s shares as a Buy, looking for them to rise to 600p.

I am doubtful that price may be achieved in 2023, even though they did nearly hit 1300p in May 2018 and after the Covid fallback they moved back up to touch 722p earlier this year.

So now at just 302.5p the group’s shares could have strong price recovery possibilities in 2023.

Shan’s estimates for the current year to end December show an almost stand-still in sales at £106.2m, but he sees adjusted pre-tax profits expanding from £7.2m to £8.0m, worth 44.5p (38.7p) in earnings and covering a 14.85p (13.00p) dividend per share.

The coming year might see a 5% lift in group sales to £111.2m taking profits up to £9.5m, earnings to 52.0p and a 17.33p dividend per share, all of which does give appeal to the company’s shares with a possible 380p sometime before next Spring.

It would only take a couple of items of good news to break the group’s share price graph turning back upwards again.

Holders should stand very firm.

I now fix a new Target Price of 380p in 2023.

(Profile 28.08.20 @ 376p set a Target Price of 480p*)

Global Ports Holding (LON:GPH) – this Profile selection has done me proud in such a short time. The world’s biggest cruise port operator has seen its shares rise convincingly since being featured two weeks ago at just 81.5p.

They closed last night at 102.25p, above my Target Price after hitting 105p during the day on the back of above average trading volumes.

After that 25% very short-term gain, I suggest that holders should sit very tight.

(Profile 11.11.22 @ 81.5p set a Target price of 100p*)

Wincanton (LON:WIN) – I was interested to note that this week The Wellcome Trust has increased its holding by 330,000 shares to 3,913,194 shares, some 3.14% of the my favourite logistic group’s equity. The shares, which touched 399p less than two weeks ago, closed last night at just 370p.

(Profile 07.05.19 @ 247p set a Target Price of 350p*)

(Profile 06.05.22 @ 412p set a Target Price of 500p)

Braemar (LON:BMS) – Following its recently declared Interim results, this shipbroker is doing an investor meeting next Monday at 11.30am. It should be well worth attending online to see exactly why I call this company as such a cheap stock. At only 328.5p the group’s shares remain substantially undervalued.

(Profile 05.12.19 @ 185p set a Target Price of 250p*)

(Profile 20.05.20 @ 99p set a Target Price of 150p*)

(Asterisks * denote that Target Prices have been achieved since Profile publication)