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3 shares the pros are trading

Our weekly roundup of trades by professional investors, featuring Revolution, K3 Capital Group and McBride.

by Selin Bucak, David Campbell on Jun 05, 2017 at 05:01

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Key stats
Market capitalisation£63m
No. of shares out50m
No. of shares floating48m
No. of common shareholdersnot stated
No. of employees2430
Trading volume (10 day avg.)3m
Turnover£119m
Profit before tax£6m
Earnings per share12.14p
Cashflow per share24.66p
Cash per share5.54p

Revolution

Citywire AA-rated small cap veteran Mark Niznik has upped his stake in chain vodka bar business Revolution (RBG) after its shares crashed more than 50% on a profit warning.

Niznik increased his holding in the business from 4.5 million shares to 5.8 million or 11.7% worth £7.23 million at a share price of 123p, down from 215p in mid-May.

The shares are held in his £421 million Artemis UK Smaller Companies fund.

Revolution plunged following an update warning of financial ‘headwinds’ from the impact of the living wage and rising business rates, in addition to a slower-than-anticipated journey to ‘full profitability’ for a number of new openings.

Canaccord Genuity cut its recommendation from buy to hold following the announcement, and slashed its target price from 300p to 150p.

Niznik is one of a few backers who see value in the stock at its current level, while both Schroders and Old Mutual’s AAA-rated Dan Nickols have reduced exposure.

Key stats
Market capitalisation£63m
No. of shares out50m
No. of shares floating48m
No. of common shareholdersnot stated
No. of employees2430
Trading volume (10 day avg.)3m
Turnover£119m
Profit before tax£6m
Earnings per share12.14p
Cashflow per share24.66p
Cash per share5.54p

Revolution

Citywire AA-rated small cap veteran Mark Niznik has upped his stake in chain vodka bar business Revolution (RBG) after its shares crashed more than 50% on a profit warning.

Niznik increased his holding in the business from 4.5 million shares to 5.8 million or 11.7% worth £7.23 million at a share price of 123p, down from 215p in mid-May.

The shares are held in his £421 million Artemis UK Smaller Companies fund.

Revolution plunged following an update warning of financial ‘headwinds’ from the impact of the living wage and rising business rates, in addition to a slower-than-anticipated journey to ‘full profitability’ for a number of new openings.

Canaccord Genuity cut its recommendation from buy to hold following the announcement, and slashed its target price from 300p to 150p.

Niznik is one of a few backers who see value in the stock at its current level, while both Schroders and Old Mutual’s AAA-rated Dan Nickols have reduced exposure.

Key stats
Market capitalisation£51m
No. of shares out42m
No. of shares floating5m
No. of common shareholdersnot stated
No. of employees87
Trading volume (10 day avg.)m
Turnover£9m
Profit before tax£2m
Earnings per share5.85p
Cashflow per share5.90p
Cash per share3.63p

K3 Capital Group

Citywire A-rated multi-cap income investors Gervais Williams and Martin Turner have upped their stake in corporate finance company K3 Capital Group (K3C), which has seen its share price rise over 6% since listing on the AIM in 12 April.

The managers increased their holding in the business from 5 million shares to 5.3 million, or 12.55% worth £6.3 million at a price of 119.14p.

The shares are held in their small-cap dividend mandate the Diverse Income trust, as well as the Investment Company and the CF Miton UK Multi Cap Income fund.

K3 Capital listed on the AIM back in April, with a market cap of £40.1 million. The business appointed wealth management firm Mattioli Woods Group’s chief executive Ian Mattioli as its non-executive chairman.

Chief executive John Rigby, said at the time: ‘Our entry to the AIM market is a positive step that marks the next phase of the Group's development as we progress our growth strategy.’

Key stats
Market capitalisation£343m
No. of shares out182m
No. of shares floating180m
No. of common shareholdersnot stated
No. of employees4616
Trading volume (10 day avg.)m
Turnover£681m
Profit before tax£17m
Earnings per share9.31p
Cashflow per share19.77p
Cash per share13.61p

McBride

Citywire A-rated value veteran Alex Savvides has upped his stake in own-brand household staples manufacturer McBride (MCB) as its shares dip from a recent record high on a round of profit taking.

Savvides increased his investment in the business from 8.7 million share to 9.2 million 5.1% worth £17.5 million at a share price of 189p, having briefly broken above 200p in the middle of May.

The shares are held in his £539 million JOHCM UK Dynamic fund.

McBride produces a range of cleaning and bathroom products marketed under retailers’ own names.

Analysts have turned sharply bullish on the stock since half-year numbers in February reporting a 30% increase in adjusted operating profits, or 9.6% excluding the gain from a devalued sterling. The company lifted its dividend 16.7% to 1.4p per share.

Numis lifted its recommendation to a buy and its price target from 205p to 211p, while Investec lifted its target from 215p to 230p.

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Look up the shares

  • K3 Capital Group PLC (K3C.L)
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  • Revolution Bars Group PLC (RBG.L)
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  • McBride PLC (MCB.L)
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