- UK stocks continue to make new highs
- Lower rates and stronger economy fan gains
- Best-performing stocks over the last year
UK stocks continue to make new highs buoyed by increasing hopes interest rates will be cut this summer and decreasing worries of economic Armageddon.
A dovish tone from Bank of England governor Andrew Bailey at this week’s (9 May) interest rate policy meeting and today’s (10 May) stronger than expected first quarter GDP reading are creating the UK’s own Goldilocks conditions.
Add in the extra spice that UK stocks are unloved and under-owned by global equity managers and the scene is set for further positive performance.
BEST PERFORMERS OVER ONE YEAR
What a difference a year can make. Twelve months ago, it would have been almost impossible to believe UK stocks would be making new all-time highs today, but how many of the best performers did the average investor pick out?
Self-elevating support vessels operator Gulf Marine Services (GMS) is the best performer in the FTSE All Share over the last year, gaining 345% as the company continues to see ‘robust’ demand for its fleet of vessels and services.
Investors love turnaround stories and the transformation at Rolls-Royce (RR.) has certainly captured investor’s attention with the shares gaining 178% over the last year.
Chief executive Tufan Erginbilgiç has engineered a big improvement in how the business operates and taken some bold moves to refocus the group, although not without some pain including 2,500 job cuts. The aircraft engine maker has set itself an ambitious target to double profits by 2027.
Another turnaround story which has not garnered anywhere near as much attention but has handsomely rewarded patient investors is private-label cleaning products company McBride (MCB) which has seen its shares gain 242%.
The budget laundry-detergent-to-surface-cleaner manufacturer has been a beneficiary of the cost-of-living crisis which has stocked demand for its affordable products.
In the six months to 31 December revenue increased by a tenth driven by price increases as well as volume growth as the company continued to take market share in the private-label market.
Software-as-a-service provider to automotive retailers Pinewood Technologies (PINE) is the former Pendragon group, which sold its motor and leasing operations to North American dealership Lithia (LAD:NYSE) for £397 million.
The radically transformed group is now a pure-play software-as-a-service business with gross margins approaching 90%, high recurring revenues and much-improved growth prospects on a global scale.
In April, the company confirmed its plan to reward shareholders by returning £358 million of capital, equivalent to more than half of its market capitalisation.
