Investors like companies with high profit margins, but Phil Oakley argues that they need to understand why a company has high margins and how it can protect them. A classic example of a high-margin, high-volume business selling expensive products is Apple, and Phil gives his verdict on the company's unveiling on Monday of its television streaming service Apple TV+. Read this week's column.
Today Chris Dillow returns to the R-word. He looks at how the US yield curve is warning us of recession. Investors should respect this message, but not fear it. Click here to read Chris's second column of the week.
And in Simon Thompson’s column today, he highlights a compelling investment case for TClarke, the nationwide building services contractor that is in a strong earnings upgrade cycle, buoyed by a record order book and higher margin being won. In fact, not only did the company deliver earnings per share almost a third higher than the house broker had originally forecast, but with the order book booming, and margins on the upgrade, analysts have just raised their forecasts by a further 8 per cent for 2019. There is good news on the dividend, too.
Since Monday last week, Simon has published articles on 20 small-cap companies and his latest small-cap report for Alpha subscribers.
Elsewhere, Fevertree posted 40 per cent growth in revenue, slightly ahead of expectations. At 45 times forward earnings, the premium drinks maker supplier's premium valuation reflects bullish investors’ high expectations of its US growth story – a little too 'premium' for our tastes, says Nilushi Karunaratne.
Talking of Fevertree bulls, here's our Bull vs Bear podcast on the company. Cheers!