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OPINION

Online growth drives Sanderson

Online growth drives Sanderson
October 23, 2012
Online growth drives Sanderson
IC TIP: Buy at 47p

Moreover, with the business maintaining strong order momentum, this offers reassurance that Sanderson will be able to raise revenues from £12.8m to £14m in the current financial year to September 2013 and deliver pre-tax profits of £2.2m and EPS of 4p as analysts predict. Trading on a forward PE ratio of 9.5, net of cash, and offering a prospective yield of 2.8 per cent, at 47p, the shares are priced well below Charles Stanley Stockbrokers' newly upgraded fair value target price of 57p. They have also broken out above 45p, a previous key resistance level I noted in my recent article (An ‘app’ investment, 15 October 2012). Buy.