Most popular equity research this week | 5-9 Dec

Interims | Purplebricks Group Plc | PURP

Zeus Capital, 5 December

"These interims show LPEs by is ahead of its plan to recruit 360 LPEs by April 2017 and is making impressive progress in Australia. The statement (and we expect the results presentation) provide considerable evidence of Purplebricks’ progress in building its brand, increasing its LPE footprint, developing its technology, creating engaging marketing and selling properties. We leave our forecasts unchanged. Investor confidence in Purplebricks’ ability to deliver sustainable profitable growth should result in share price appreciation towards a valuation based on its results for the year ended April 2019..."

Quality business as usual | Iomart Group | IOM

finnCap, 6 December

"iomart's interims show delivery of continuing organic growth, complemented by targeted acquisitions to extend the strategic opportunities. Compared with peers exposed to project-based revenue, cloud services organic growth continued at 10% (comfortably within our expected 8-11% target range), with the evolution of margins as expected: the growing proportion of public cloud services mildly easing EBITDA margins but maintaining or even strengthening adjusted PBT margins, given the lack of related depreciation. With high-quality recurring revenue at high margins, and (lower margin, lower recurring revenue) peer group exit valuations comfortably above iomart’s current valuation, the upside remains very clear. Target 360p reiterated..." 

Strong demand, on track for full year | M J Gleeson Plc | GLE

Liberum, 8 December

"Gleeson’s AGM statement says that it is on track to achieve FY profit expectations, even though profits will be a little down in H1. Growth remains strong for its Homes business, with volumes expected to grow by around 15% this year..."

Good end to the year | Dialight | DIA

N+1 Singer, 5 December

"A month on from the previous in-line trading statement, Dialight now reports good trading in November and prospects for December lead to a new comment that management is targeting an underlying EBIT for 2016 materially ahead of expectations. Revenue expectations are unchanged, suggesting earlier than expected returns from management’s strategic actions on costs. We recently increased our estimates for currency impacts and our 12 month price target to 800p based on the 2017 EV/Sales multiple. As such, although consensus estimates seem likely to increase again for 2016, our price target remains unchanged..."

Trading update – further cut to forecasts and selling CAS | Capita Plc | CPI

Panmure Gordon & Co, 8 December

"We keep our target price, but restate our view that this is just the start…..."

Product quality and management depth | Focusrite Plc | TUNE

Edison, 7 December

"Yesterday Focusrite held a capital markets day, designed to showcase the range and quality of products and introduce operational management, which shares a passion for music-making and has deep knowledge of the products. This contributes to excellent product support, software innovation and thus customer loyalty, which should sustain the company’s brand leadership..."

Encouraging sales progress at Express | Findel | FDL

Edison, 7 December

"Findel’s largest business, Express Gifts, posted strong revenue growth in H1 and has sustained the trend into H2. Currency headwinds will cause a pause in profit growth in FY18e but plans to continue building the customer base and revenues are encouraging for the medium term. Education, now showing signs of improvement, will continue to rely on self-help in a challenging market..."

Exponential growth now in sight | Kromek Group Plc | KMK

Equity Development, 7 December

"The best things in life are worth waiting for, or at least that seems to be the case with Kromek, a pioneering radiation detection expert. Since listing on AIM at 51p back in October 2013, the company has not only been busily refining and field testing its next generation CZT (cadmium zinc telluride) technology, but importantly also securing a raft of new orders..."

At a 19% discount to Indonesian sector peers | R.E.A. Holdings Plc | RE/

Hardman & Co, 7 December

"R.E.A. Holdings plc ("REA") announced the completion of the acquisition by PT Dharma Satya Nusantara Tbk (“DSN”) of a 15% shareholding in PT REA Kaltim Plantations (“REAK”), on Friday, 2nd December. The agreements between the group and DSN, received regulatory approval and were completed on 2 December 2016. As a result, subsidiaries of DSN have acquired, by a combination of subscription for new shares and acquisition of existing shares, a 15% equity interest in REAK. DSN can acquire up to 49% of REAK within the next 5 years (subject to agreement regarding amongst other things, the price at which further shares can be acquired)...."

Continued momentum | Amino Technologies | AMO

Progressive Equity Research, 8 December

"Amino has this morning published a positive trading update, with figures for the year to November 2016 slightly ahead of our forecasts. We upgrade our 2016 estimates modestly, to reflect confirmation of this expected strength and upbeat comments on order backlog. Having recently upgraded our 2017 estimates, we choose to leave these unchanged for now, but will revisit them in February 2017 alongside full FY16 results..."