Saturday, 16. December 2017  
03.11.2016 20:21
Author: Nic Wright

STOCK SCREEN: UK Stocks With Solid Upside To Intrinsic Value For A Possible Brexit Halt

 

UK’s decision to leave the EU sent global financial markets into a spin and saw the pound plunge to its lowest level in more than 30 years, as investors bet that the UK economy would suffer. Four months after the referendum it has become clearer that the average UK citizen will have to deal with higher inflation, a falling British pound and a weaker economy.

A weakening consumer confidence is likely to hit sales and the pound’s fall will make products bought in dollars more expensive. Recently, retailers dependent on goods from the EU, warned already of a tough year ahead, made worse because of Brexit.

 

Surprisingly, a panel of London judges decided that the U.K. must hold a vote in Parliament before starting the two-year countdown to Brexit, setting up a constitutional confrontation at the country’s Supreme Court next month. The British pound gained strongly after the High Court ruling, giving hope to some market participants, that the Brexit process is not irrevocable.

 

In looking for ideas this week, we screen for UK consumer related stocks with solid upside to our AVM’s intrinsic value estimate and weak price performance due to Brexit.

 

Here are the filter criteria we used:

 

1. Market Capitalization above 1bn.

2. Industry is Consumer Cyclical and Non-Cyclicals

3. Stock price at least -5 percent on 12m.

4. 20 percent Upside or more based on our AVM’s Mean Multiple Value approach.

 

Here is our list of stocks matching all criteria in alphabetical order. Company names in the table below are linked to the ANALYZER, our single stock analysis tool. Intrinsic Value Model assumptions can be adapted in the MODELER, our modeling and forecasting environment:

 

CLICK COMPANY NAME FOR DETAILED STOCK VALUE ANALYSIS

INDUSTRY

LAST PRICE

MARKET CAP.

6M PRICE CHNG. %

12M PRICE CHNG. %

MEAN MULTIPLE UPSIDE [%]

DIVIDEND YIELD [%]

 AGGREKO PLC

 Commercial Services

784.00

2008

-27.7

-17.1

92.9

3.5

 B&M EUROPEAN VALUE RETAIL SA

 Retail

241.40

2416

-9.8

-25.3

50.6

2.6

 BERKELEY GROUP HOLDINGS

 Home Builder

2420.00

3375

-17.9

-24.2

44.7

8.3

 BOVIS HOMES GROUP PLC

 Home Builder

802.00

1082

-7.4

-18.6

68.9

5.6

 CAPITA PLC

 Commercial Services

583.50

3893

-41.2

-54.5

77.0

5.5

 CREST NICHOLSON HOLDINGS

 Home Builder

434.40

1105

-17.5

-18.7

46.7

6.4

 GREENE KING PLC

 Retail

748.00

2321

-8.9

-8.0

21.9

4.5

 PAGEGROUP PLC

 Commercial Services

372.00

1213

-5.7

-23.8

38.4

3.7

 PETS AT HOME GROUP PLC

 Retail

224.00

1120

-8.4

-20.0

33.7

3.7

 SKY PLC

 Media

820.00

14096

-12.4

-24.6

34.5

4.2

 SPORTS DIRECT INTERNATIONAL

 Retail

303.90

1803

-20.2

-55.7

98.4

0.0

 THOMAS COOK GROUP PLC

 Leisure Time

70.95

1090

-17.5

-41.9

62.7

1.6

 TRAVIS PERKINS PLC

 Retail

1409.00

3520

-24.0

-27.9

23.8

3.3

 TUI AG-DI

 Leisure Time

1067.00

7030

8.6

-8.4

34.0

5.2