AIM for Growth

At the beginning of the year I bought AIM super stock, AB Dynamics and after 5 months it has earned a return of over 50%. This is extremely impressive compared to a return of around 12% for the FTSE AIM 100 and a rise of only 7% for the FTSE 100 for the same period.  The company’s high growth performance isn’t just in isolation either, with the stock producing over a 357% return since the start of 2017, suggesting that this isn’t just a lucky year or an overhyped valuation by the market. So the question is, can the stock continue to grow?  WHAT THEY DO AB Dynamics supply integrated test systems for the automotive industry, with a client list that includes major brands such as BMW, Audi, and Chrysler. The stock is currently listed on the FTSE AIM market, with a market cap of £471 million.  The testing industry may be an unglamorous part of the automotive industry versus investing in brands such as BMW and Rolls Royce, but it is an important part of the...

I recently spoke about Burford Capital and the potential troubles it faces in the short-term due to the suspension of Woodford’s Equity Income Fund. Another stock that is also struggling, as a result, is Hargreaves Lansdown, the investment service provider, with its share price dropping over 20% in the last month. This is a considerable drop and requires investors to consider if this is a short term reaction to recent events or the beginning of a longer-term shift. Therefore, investors need to identify if this a sign to sell as the company is on a long-term downward trend, or is this a buying opportunity due to market overreaction? WOODFORD The recent dismal performance and resulting closure from multiple redemptions of the Woodford Fund has resulted in a backlash on Hargreaves Lansdown share price. This is because the company had continued to champion the fund, supporting it via its new and updated Wealth 50 platform when perhaps other funds were more justified. The disappoin...

Burford Capital Ltd (BUR) is one stock that I’m still unsure about as it’s very difficult to understand how the business is doing, and therefore understanding its long term profitability proves a problematic task. To give context, Burford Capital is listed on the FTSE AIM 100 and is an investment firm that specialises in generating finances for litigation, along with associated activities such as advisory services in the legal field. WOODFORD Though the stock isn’t in the LF Woodford Equity Income fund, it is held in another Woodford Investment fund, Woodford Patient Capital Trust. This is a closed-ended fund, aimed at delivering long term growth. However, due to being under the same management in Woodford, the firm could suffer indirectly from a decrease in sentiment towards Woodford’s investment approach. VOLATILE The business has done extremely well in the long term, recording a return of 691% since 2016. However, the stock has been particularly volatile in the sh...