Category Archives: My SharePad Articles

[SharePad] Screening For My Next Long-Term Winner: Frontier Developments

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11 June 2020
By Maynard Paton

Has the market become too obsessed with ‘pandemic-proof’ shares?

I ask because my SharePad screening has brought Frontier Developments to my attention.

The shares of this computer-game developer have leapt 66% so far this year as industry sales rally during the lockdown.

However, Frontier’s accounting looks rather questionable and the near-£800 million market cap seems completely mad. Yet nobody seems to mind given the company’s apparent resilience to Covid-19.

Read my full Frontier Developments article for SharePad.

Maynard Paton

PS: I have also compared Frontier’s accounting to that of Team17 and Codemasters.

[SharePad] Screening For My Next Long-Term Winner: Hikma Pharmaceuticals

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14 May 2020
By Maynard Paton

One way to invest during the pandemic is to consider shares that have climbed higher as the market has dropped.

Such companies may well be ‘safe havens’ — businesses that are coping well with the lockdown, or perhaps even benefitting from the crisis.

I applied the following simple criteria within SharePad to identify potential ‘pandemic-proof’ names:

  • A share-price change this year of 0% or more;
  • A market cap of £250 million or more, and;
  • A profit of £1m or more.

On my shortlist was Hikma Pharmaceuticals, which has rallied 17% so far this year. Other attractions included:

  • An appealing 22% margin and 19% return on equity;
  • Profit being twice the level of debt;
  • A forecast 18x P/E not appearing too extreme, and;
  • The directors owning a useful shareholding.

Read my full Hikma Pharmaceuticals article for SharePad.

Maynard Paton

[SharePad] Screening For My Next Long-Term Winner: A Covid-19 Special

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08 April 2020
By Maynard Paton

I have just applied a new SharePad screen to seek ‘quality bargains’ amid the market chaos — and sadly the results were not that inspiring.

The problem is nothing to do with me or my filters or SharePad. Instead, the Covid-19 crisis has turned so many companies upside down…

…that trying to identify dependable shares right now is not exactly straightforward.

But fear not! To make amends, I have run through my previous SharePad articles — and highlighted some interesting names for your consideration.

Read my full Covid-19 Special article for SharePad.

Maynard Paton

[SharePad] Screening For My Next Long-Term Winner: AB Dynamics

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18 March 2020
By Maynard Paton

Recent market ructions have sent many shares tumbling — and perhaps created some buying opportunities.

Amid the mayhem, I devised a straightforward screen. I simply looked for decent-sized businesses that were still expected to grow, paid a dividend and were conservatively financed.

I applied the following criteria within SharePad to identify some respectable candidates:

  • Forecast earnings per share growth of at least 10% this year;
  • A market cap of £250 million or more;
  • Must have paid a dividend last year, and;
  • Net borrowings of less than zero (i.e. a net cash position).

I then ordered the shortlist based on how far each share price had fallen since its 52-week high.

I selected AB Dynamics because, of the names on my shortlist, I knew AB possessed a reputation for ‘business quality’ and its shares had fallen among the furthest.

Read my full AB Dynamics article for SharePad.

Maynard Paton

[SharePad] Screening For My Next Long-Term Winner: Boohoo

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16 February 2020
By Maynard Paton

Cash flow movements can often indicate whether or not a business enjoys a powerful operational advantage.

A strong business might:

  • Receive customer payments upfront for goods/services it has yet to deliver, and/or;
  • Pay suppliers months after goods/services have been received.

However, a weak business might:

  • Receive customer payments months after its goods/services have been delivered, and/or;
  • Pay suppliers upfront for goods/services it has yet to receive.

SharePad allows us to easily pinpoint companies that operate with advantageous cash flow movements. Boohoo, the prominent online fashion retailer, offers a good example of what to look for.

Read my full Boohoo article for SharePad.

Maynard Paton

[SharePad] Screening For My Next Long-Term Winner: Greggs

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26 January 2020
By Maynard Paton

‘Run your winners’ is popular stock-market advice.

Great companies often remain great investments for a lot longer than most people expect…

… and can deliver life-changing rewards to anyone who refrains from selling out too soon.

Where can we find potential winners to run? I thought the best performing shares of 2019 would provide a good starting point.

One business that did well during 2019 was Greggs, the well-known bakery chain, which saw its shares rocket more than 80%.

Greggs is actually a textbook example of ‘running your winners’. The shares had already surged 100-fold before last year’s price jump.

Read my full Greggs article for SharePad.

Maynard Paton

[SharePad] Screening For My Next Long-Term Winner: Mears

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20 December 2019
By Maynard Paton

This SharePad article did not turn out as I had expected.

I had thought I would be evaluating a business with glorious financials and tip-top management.

I ended up studying accounting alarm bells and a dissident shareholder trying to oust the boardroom.

The SharePad screen I used looked for companies that offered:

1) A 20-year (or more) record of dividend increases, and;
2) Forecast dividend growth for the current year.

I selected Mears, a £269 million provider of housing-maintenance and social-care services, due to its forecast 5.3% yield.

Read my full Mears article for SharePad.

Maynard Paton

[SharePad] Screening For My Next Long-Term Winner: Webinar

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07 December 2019
By Maynard Paton

I recently hosted a SharePad webinar, during which I demonstrated three screens used in my SharePad articles and evaluated three companies using various SharePad features.

The filters I used were taken from my SharePad articles on Renishaw, Rightmove and Medica, and the companies I evaluated were XP Power (01:00), Headlam (15:30) and Sopheon (29:00). 

I finished the SharePad webinar with a Q&A session (45:00). 

Just click the image below to watch a recording of the webinar.

sharepad maynard paton webinar screening for my next long-term winner
(Click the image to watch via Youtube)

You can import the financial charts I used during the webinar into your SharePad setup by following the instructions half-way down this page.

Maynard Paton

[SharePad] Screening For My Next Long-Term Winner: Dotdigital

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20 November 2019
By Maynard Paton

Today I have revisited a share screen that applies two ratios favoured by ‘quality’ investors — operating margin and return on equity (ROE).

The exact criteria I re-used were:

1) An operating margin (latest and 10-year average) of 20% or more, and; 
2) An ROE (latest and 10-year average) of 20% or more.

This time I have pinpointed Dotdigital, a £265 million software business that is blessed with a 30% operating margin and a 30% ROE.

Read my full Dotdigital article for SharePad.

Maynard Paton

[SharePad] Screening For My Next Long-Term Winner: Rightmove

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25 October 2019
By Maynard Paton

Studying free cash conversion is vital when evaluating a set of accounts.

The measure compares free cash flow to reported earnings, and can indicate whether a business is a ‘cash fountain’ or a ‘cash guzzler’.

Ideally we want to own companies that generate plenty of spare cash, because such cash can:

  • Underpin accounting profits;
  • Indicate an attractive business, and;
  • Fund welcome dividends.

By employing SharePad, I identified Rightmove as an elite cash producer.

Read my full Rightmove article for SharePad.

Maynard Paton

[SharePad] Screening For My Next Long-Term Winner: Medica

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30 September 2019
By Maynard Paton

Dynamic growth shares are among the market’s most exciting investments.

Find a business that has expanded rapidly and offers the prospect of further earnings growth — but also has an overlooked share price — and you could be on to a winner.

Medica — an AIM-traded supplier of radiology reports to hospitals — could be one such opportunity. The company’s forecast P/E of 15 appears modest given the 300%-plus earnings growth seen during the previous five years.

Read my full Medica article for SharePad.

Maynard Paton

[SharePad] Screening For My Next Long-Term Winner: Hammerson

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04 September 2019
By Maynard Paton

Buying a share at a discount to its book (or net asset) value ought to be the safest way of investing.

Indeed, what could go wrong if you can effectively buy assets worth £1 per share for, say, 50p?

The reality — sadly — is not always that simple.

Let me show you what I mean by using SharePad to evaluate Hammerson, a FTSE 250 real estate investment trust with net tangible assets of £5 billion and a market cap of only £1.6 billion .

Read my full Hammerson article for SharePad.

Maynard Paton

[SharePad] Screening For My Next Long-Term Winner: AG Barr

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09 August 2019
By Maynard Paton

Quality companies undergoing temporary problems can often become attractive investment opportunities.

On that basis, perhaps AG Barr is worth closer inspection.

The soft-drinks manufacturer famous for Irn-Bru recently warned that profits would be lower than expected… and the share price plunged accordingly.

However, AG Barr does boast a quality track record. During the last 40 years for example, the group has lifted its annual dividend by an average 11% — and shareholders have never seen their income cut.

Read my full AG Barr article for SharePad.

Maynard Paton

[SharePad] Screening For My Next Long-Term Winner: Imperial Brands

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15 July 2019
By Maynard Paton

Imagine this. You find a blue-chip company that offers:

  • 21 years of consecutive dividend increases, with the last ten years showing 10% per annum growth;
  • Management guidance of further 10% annual dividend growth “over the medium term”, and;
  • A share price with a 10% dividend yield.

Too good to be true?

Well, that is the situation at Imperial Brands.

Read my full Imperial Brands article for SharePad.

Maynard Paton

[SharePad] Screening For My Next Long-Term Winner: JD Sports Fashion

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24 June 2019
By Maynard Paton

Today I am revisiting the share screen that pinpointed Games Workshop back in January.

The shares of the quirky wargaming retailer have soared more than 60% since that review…

…and I wonder whether the same screen can unearth another promising opportunity.

This time the screen returned 26 matches, and I plumped for the largest on the list — sports retailer JD Sports Fashion.

JD’s earnings per share have surged from 6p to 27p — an average of 35% per annum — during the last five years.

Read my full JD Sports Fashion article for SharePad.

Maynard Paton