AIM for Growth

In today’s blog I look at the investment case for Smith and Nephew, a FTSE 100 pharmaceutical giant with a market cap of £14,730 million. Since 2015 the stock has returned over 90% and continues to look attractive going forward. It may not provide the super growth that AIM stocks could potential deliver, but it does provide diversification for your portfolio to balance out risk of investing in small- and mid-cap companies. DEMAND The company has three sectors that it specialises in which are orthopaedics, sports medicine and advanced wound treatment. For example, this includes equipment used in operations for knee replacements and rotator cuff repair. The demand for these business sectors should continue to grow regardless of UK economic conditions, as healthcare is of increasing importance. This is supported by the global trend which can be seen in developing countries such as the US, Smith and Nephew’s highest market by revenue, are moving towards an aging p...

Back in November when Aviva’s share price dropped below £4 I thought that it would bounce back after a sharp market sell off. Though shares did continue to drop further, all the way down to below £3.65 in December, the market returned to normal levels of £4.30 before again dropping off to sub £4 levels recently.  The question for investors therefore is, can the stock once again rebound and return to the £5 mark or will it see another sell-off to drop even further than current valuations. NEW CEO Aviva is taking steps in a new direction with the departure of former CEO Mark Wilson, and the arrival of Maurice Tullock as his replacement. Though people were happy with Wilson’s revival of Aviva, it is arguably the right time for someone new as Wilson has completed his task at the company.  Further management shake ups are happening with Aviva’s chief of finance, Tom Stoddard stepping down at the end of the year, ending a five year reign with the company. The new CEO als...

I recently shifted my investment strategy to focus on UK growth stocks in the search for higher returns than that on offer in the FTSE 100. As a result, this has lead my research into the FTSE AIM index, which is a market for smaller growth companies to raise capital to fund expansion. The AIM index provides a great alternative to the FTSE 100 for portfolio selection and offers a host of benefits for new investors. SOURCE OF GROWTH The FTSE AIM 100 is full of great stocks, including names such as Fevertree, Boohoo Group PLC, and my previously discussed AB Dynamics . Such stocks have produced stunning returns over the years such as a 1500% return since 2015 for AB Dynamics and over 1300% return for Fevertree within the same time period. It is important to understand though that due to such great returns there is the potential for equally large downside. For example, the recent collapse of Burford Capital which dropped over 60% in one week. This is why I would suggest that AIM...

When investing in the UK market I normally focus my research on FSTE AIM stocks as I think this is where greater growth can be found as the FTSE 100 is very well covered in comparison to small and mid-cap stocks. This means that the market has priced in future growth for the relevant companies.  However, the FTSE 100 does offer a variety of companies that can provide a good source of steady growth to mitigate risk in your portfolio against smaller, higher-risk growth stocks. A FTSE 100 giant that I think will do well over the long term is Experian, providing a steady stream of growth to support an investor’s portfolio.  WHAT THEY DO? Experian is a global information servicing company, supplying global services to over a billion people. They are most famous for their credit checks business, currently one of the top three credit checking agencies globally, but they also offer a variety of information processing services.   From an investment perspective, th...

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...