Intellectual property support services company RWS Holdings (LSE: RWS) has today released an upbeat set of full-year results which show that it is making encouraging progress. In fact, its pretax profit increased by 6% on a reported basis as its core translation services business continued to deliver strong growth.
This, when combined with impressive performance from RWS’s inovia and PatBase offerings, means that dividends per share have been increased by 6.6%. As a result, dividends have risen in every year since RWS was floated twelve years ago.
Although RWS has posted share price growth of 73% in the last six months, there is still scope for further capital gains. That’s at least partly because the company is expected to increase its bottom line by 17% in the current year, which puts it on a price to earnings growth (PEG) ratio of only 1.3. And, with RWS benefitting from having a niche product with high entry barriers, its long term future appears to be exceptionally bright.
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Similarly, Centamin (LSE: CEY) has the potential to soar in 2016 and beyond, with the gold producer in the midst of ramping up production. In fact, Centamin is expected to increase production to 500,000 ounces per annum in 2017 and this has the potential to boost its bottom line over the medium term.
Certainly, the outlook for the gold price is rather uncertain. It hit a five year low this year and, with US interest rates set to rise as soon as next week, the price of the precious metal could come under pressure. That said, if there is uncertainty regarding the global economic outlook then gold could again become en vogue as investors seek a store of wealth.
For Centamin, though, the story is one of increasing production and, while the price of gold is difficult to accurately predict, Centamin is expected to report a bottom line which is 19% higher next year. This, plus a PEG ratio of 0.6, indicates that now could be a good time to buy for the long term.
Also offering upbeat prospects is Unilever (LSE: ULVR). Although the company derives the majority of its revenue from emerging markets, it continues to have a major presence in the developed world and, with the European economy set to deliver an improved 2016 due to the impact of quantitative easing, Unilever’s profit outlook is relatively upbeat.
Allied to its growth potential is Unilever’s stability. It operates in a wide geographical area and has a range of brands in a number of different sectors. As such, it is well-shielded from any future problems in the global economy. With the world’s two largest economies undergoing significant changes in terms of interest rate rises (US) and slowing growth (China), Unilever’s resilience could be a major plus for investors next year. Therefore, with Unilever trading on a PEG ratio of 1.8, it appears to be a bargain buy.
