Investing alongside you, fellow Foolish investors, here’s a selection of shares that some of our contributors have been buying across the past month!
Advanced Medical Solutions
What it does: AMS designs, develops, and manufactures innovative tissue-healing technology and wound-care.
By Dr James Fox. I bought Advanced Medical Solutions Group (LSE:AMS) shares a few weeks ago, and while I was buying for the long run, they’ve been good to me so far. At the time of writing, the stock is up 7% since purchase.
It’s a medium-sized business with a track record of delivering strong cash flows and has a competitive advantage in its specialised medical products. It also operates in a highly resilient sector – namely healthcare. Moreover, given the elective procedure backlog, demand should be strong.
The Cheshire-based firm has a reputation for healthcare innovation, and this will likely be enhanced by the launch of LiquiBandFix8. The hernia surgery product was granted pre-market approval ahead of schedule and is now in the partner selection phase.
US LiquiBand sales fell in the first half of the year, and that’s a concern, but the company says partner negotiations are progressing well. Hopefully this will contribute to an uptick in sales and overall revenue in the second half.
James Fox owns shares in Advanced Medical Solutions.
Barclays
What it does: Barclays is an international bank with operations including retail and investment banking.
By Charlie Keough. I recently opened a small position in Barclays (LSE: BARC). The stock has struggled year to date, down around 8% as I write. However, I’m optimistic.
First of all, it offers a dividend yield of over 5%, which should be well covered by earnings. Its half-year results also saw its interim dividend increase, while a new share buyback scheme of £750m was launched.
On top of this, its shares also trade on a price-to-earnings ratio of just 4.3.
Barclays also has an edge over some of its competitors with its balance between tight-knit risk management versus global opportunities, in my opinion.
And in the years ahead, banks should bounce back when interest rates begin to come down again closer to the 2-3% range.
Global economic uncertainty and volatility surrounding the banking sector could damage the share price. After all, the turmoil we saw earlier this year saw the stock hit a 52-week low.
However, as a long-term buy, I think Barclays shares are a smart move.
Charlie Keough owns shares in Barclays.
Cerillion
What it does: Cerillion is a software business that provides billing, charging, and customer relationship management (CRM) solutions, predominantly to telecoms firms.
By Edward Sheldon, CFA. Cerillion (LSE: CER) shares recently experienced a pullback and I took the opportunity to boost my holding in the software company.
This is one of my favourite stocks on the UK’s Alternative Investment Market (AIM). For starters, the company is growing at a rapid rate. Over the last five financial years, revenue has more than doubled as businesses have embraced Cerillion’s software solutions. For the year ending 30 September 2023, analysts expect top-line growth of 17%.
Meanwhile, its financials are strong. Return on capital (a key measure of profitability) is high and there’s no debt on the balance sheet. As for the dividend payout, it’s growing at a very fast pace (the H1 payout was hiked by 27%).
The downside to buying these shares is that its valuation is relatively high. Currently, the forward-looking price-to-earnings (P/E) ratio is a little over 30, which doesn’t leave much room for error.
I’m comfortable with this valuation, however, given the company’s growth track record and superb financials.
Edward Sheldon owns shares in Cerillion
EOG Resources
What it does: EOG Resources develops, produces, and markets crude oil and natural gas liquids, primarily in New Mexico and Texas.
By Gordon Best. I’ve been buying shares in EOG Resources (NYSE:EOG) recently.
After the energy sector soared in 2022 amid geopolitical uncertainty, the sector has been the worst performing of the S&P 500. However, the price of crude oil has started to rebound, indicating a potential buying opportunity. EOG Resources has always been a favourite of mine, with a price-to-earnings (P/E) ratio of 8.1 times well below the sector average of 13.2 times.
A notable risk is how cyclical the energy sector can be, amid growing focus on clean energy. Negative sentiment or reduced demand would impact the share price. However, through economic uncertainty, oil demand is likely to be high, and with large cash reserves, the company is well positioned to perform decently regardless.
With a generous dividend of 5.6%, and a strong track record of growth, I see EOG Resources as a solid defensive investment for my portfolio.
Gordon Best own shares in EOG Resources.
Glencore
What it does: Glencore is a leading global producer of metals and minerals, and also makes money from commodity trading and arbitrage.
By Harvey Jones. My portfolio is light on commodity stocks so when I saw Glencore (LSE:GLEN) shares had dipped 20% in a matter of months, I jumped at the chance to buy on 26 July. I’ve had a bumpy ride so far, although I expected that. This sector is more volatile than most.
Investors have been spooked by signs of disinflation in China while the US could still fall into recession, hitting commodity demand and prices.
On Tuesday, Glencore reported that first-half earnings had halved to £9.9bn, due to weaker commodity and energy prices. Management also blamed “inflation, tighter monetary conditions and limited global economic growth”.
Despite that, I’m happy with my purchase. The stock looks good value trading at 9.5 times forecast earnings and is still expected to yield 7.91% this year and 6.68% in 2024.
Since I’m aiming to hold for a minimum of 10 years and ideally longer, I can ignore short-term bumpiness and allow time for my dividends and share price growth to compound.
Harvey Jones owns shares in Glencore.
Lloyds
What it does: Lloyds is the UK’s largest mortgage provider. It’s also one of the nation’s biggest banks with over 30m customers.
By John Choong: With the Lloyds (LSE:LLOY) share price sinking below 50p recently, I’ve been steadily buying up shares of this leading UK bank. While headline results disappointed some investors, causing the sell-off, I focused on the fundamentals instead.
Rather than reacting to short-term noise, I’m taking a longer-term outlook. After all, management upgraded guidance despite economic uncertainty, with its dividend jumping 15% as well. Bearish views seem to overlook Lloyds’ strong outlook too, as I expect net income to jump as structural hedges take effect in H2, with cost-cutting benefits expected to provide a tailwind.
Trading below tangible book value as well, Lloyds shares offer deep value versus peers as the bank has room to expand margins through fee income and digital offerings. While some fret over near-term headwinds, I’ve been opportunistically buying Lloyds stock on weakness. The future looks bright for this stable UK bank once the clouds clear.
John Choong has positions in Lloyds
Mastercard
What it does: Mastercard is a payment processing company enabling consumers and businesses to complete electronic payments.
By Zaven Boyrazian. While the ongoing cost-of-living crisis continues to put pressure on families, the economic landscape has started to improve both in the UK and internationally. Consumer spending is slowly recovering as inflation begins to cool off. And it’s allowed payment processing giants like Mastercard (NYSE:MA) to enjoy some impressive transaction volumes.
Looking at its latest results, a total of $2.3trn (£1.8trn) moved through Mastercard’s payment network between April and June this year. And that’s up from $2.1trn (£1.7trn) just three months prior.
By charging small fees on each transaction, the company has bolstered its revenue and earnings by double-digits. And while it’s fiercely fighting for market share against the likes of Visa, Mastercard continues to consistently beat analyst expectations.
Future growth prospects are strongly tied to the Asian and African markets, which may be difficult to penetrate. Nevertheless, I remain optimistic about the long-term potential of this enterprise, and bought the shares recently.
Zaven Boyrazian owns shares in Mastercard.
Ramsdens Holdings
What it does: Ramsdens Holdings is a financial services group that offers foreign currency exchange, pawnbroking loans, and the buying and selling of jewellery.
By Ben McPoland. I’ve recently started a position in Ramsdens Holdings (LSE: RFX). This is a penny stock with a market capitalisation of just £70m, so high volatility is an unavoidable risk here.
Nevertheless, there are a number of things I like about this company. One is its diversified offerings, which range from jewellery retail and pawnbroking to foreign currency exchange.
Pawnbrokers tend to do well when consumer incomes come under pressure, and that’s no different during the current cost-of-living crisis. The firm is posting record revenue and operating profits across the full business.
Second, the stock carries a 4.3% dividend yield covered 2.5 times by trailing 12-months earnings. It just hiked the half-year dividend by 22%.
Finally, the stock trades on a cheap P/E multiple of 9.2. That’s attractive because earnings growth is set to continue as Ramsdens adds to its 158 stores around the UK. Its online offering is also growing rapidly and the company intends to consolidate the highly fragmented market in which it is thriving.
Ben McPoland owns shares in Ramsdens Holdings.
Ten Entertainment
What it does: Ten Entertainment operates a network of bowling alleys around the UK, which also offer a range of other entertainment options.
By Roland Head. Ten Entertainment (LSE: TEG) has recovered strongly from the pandemic and recently reported half-year sales 57% above pre-Covid levels.
The business is continuing to expand and expects to open at least four new centres in 2023, taking its total estate to more than 50 centres.
The firm’s more recent accounts show attractive double-digit profit margins and strong cash generation. Ten Entertainment has no debt other than lease liabilities.
There’s obviously some risk of a slowdown in consumer demand if the UK suffers a recession. Growth could become a challenge, too — I don’t know how many more centres the firm will be able to open.
However, Ten Entertainment’s offering is relatively affordable and appeals to a broad market. The company’s shares look decent value to me too, trading on just nine times forecast earnings, with a 4.1% dividend yield.
I think the stock could deliver a decent return from current levels.
Roland Head owns shares in Ten Entertainment.
