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5 small shares that top fund managers are trading

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We delve into regulatory returns to see what small shares are being bought and sold by some of the best professional investors.
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Key stats
Market capitalisation£400m
No. of shares out63m
No. of shares floating37m
No. of common shareholdersnot stated
No. of employees1116
Trading volume (10 day avg.)1m
Profit before tax£19m
Earnings per share32.56p
Cashflow per share49.45p
Cash per share7.12p

*Correct as at 28 Mar 2014

Citywire AA-rated star UK equity duo Anthony Cross and Julian Fosh have upped their investment in healthcare data management business EMIS following a year in which shares have dropped 10%.

Cross and Fosh increased their holding in the company from 6.55 million shares to 7.04 million or 11.12% worth £43.5 million at a share price of 619p.

The shares are held across their portfolios but the largest holding is within their Liontrust Special Situations fund.

Broker Panmure Gordon reiterated its buy recommendation on EMIS Group this week, with a price target of 731p. Numis also rates the company a buy, with a target of 860p.

In full year results for 2013 EMIS reported total revenues up 22% over the year to a total £105 million and operating profit up 14% to £26.1 million.

The company currently trades at multiple of 17 times 2013 earnings, versus a peer average of 27.5.

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Key stats
Market capitalisation£25m
No. of shares out9m
No. of shares floating6m
No. of common shareholdersnot stated
No. of employees106
Trading volume (10 day avg.)0m
Profit before tax£1m
Earnings per share9.54p
Cashflow per share16.46p
Cash per share40.57p

*Correct as at 28 Mar 2014

Graham Neale, partner at Killik and manager of the company’s AIM fund, has opened a significant position in private jet sales and servicing business Hangar 8.

Neale took 500,000 shares in the company or 5.3% worth £1.35 million at a share price of 271p, up 93.5% over the last three years versus a FTSE AIM return of -5.97%.

‘The shares are valued at 13 times on a forward price to earnings basis, which we think is attractive given the company’s growth prospects and the recent announcement of a maiden dividend,’ Neale told Citywire.

‘The company is benefiting from the increasing requirement for professionalism in aircraft logistics, which is driving customers towards established operators such as Hangar 8.’

Broker Cantor Fitzgerald upped its price target against the company from 270p to 310p in March, rated buy. That followed results for the second half of 2013 showing revenues up 13.1% to £12.5 million while earnings rose 41% to £880,000.

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Key stats
Market capitalisation£269m
No. of shares out107m
No. of shares floating78m
No. of common shareholdersnot stated
No. of employees248
Trading volume (10 day avg.)0m
Profit before tax£7m
Earnings per share6.63p
Cashflow per share13.05p
Cash per share10.88p

*Correct as at 28 Mar 2014

Anthony Cross and Julian Fosh, both Citywire AA-rated managers at Liontrust, have added to their stake in Scottish IT firm iomart.

They have bought another 1.3 million shares – worth £3.3 million – in the company, which means they now own 11% of iomart.

Based in Glasgow, iomart specialises in cloud computing and operates data centres in eight locations across the UK. Its share price has surged more than sevenfold from 32p five years ago to around £2.45 today.

But although the business is still strong – its most recent results revealed that profits had risen by 29% in the six months to the end of September – investors have been cashing out, which has knocked 20% of the share price since that month.

According to Citywire data, Cross and Fosh have returned 87% over the past three years, significantly outperforming both their average small-cap peer’s 65% and the market’s 74%. They follow Liontrust’s ‘economic advantage’ model, which focuses on companies with ‘distinctive, intangible strengths that competitors struggle to reproduce’.

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Key stats
Market capitalisation£263m
No. of shares out642m
No. of shares floating481m
No. of common shareholdersnot stated
No. of employees361
Trading volume (10 day avg.)4m
Turnover28m EUR
Profit before tax-34m EUR
Earnings per share-0.06 EUR
Cashflow per share-0.06 EUR
Cash per share0.08 EUR

*Correct as at 28 Mar 2014

Global value star John Pennink, manager of the £843 million British Empire trust, has upped his conviction in holiday resort owner Dolphin Capital Investors ahead of its annual results.

Pennink increased his holding in the business from 17.92 million shares to 19.48 million or 3.03% worth £7.6 million at a share price of 39p, up 4% over one year versus a FTSE AIM return of 16.3%.

Broker Panmure Gordon rates the company a strong buy with a 52p price target.

On the most recent valuation at end of September, the shares traded at a 50% discount to the net asset value of the company’s portfolio, although much of that is related to its £144 million in debt.

The company owns property in Cyprus and saw some disruption to its business during last year’s bailout and depositor haircut, with sales down 48% over the nine months to the end of November.

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Key stats
Market capitalisation£4m
No. of shares out101m
No. of shares floating65m
No. of common shareholdersnot stated
No. of employees74
Trading volume (10 day avg.)1m
Profit before tax£0m
Earnings per share0.22p
Cashflow per share0.54p
Cash per share0.22p

*Correct as at 28 Mar 2014

Citywire AAA-rated small cap veterans David Horner and David Taylor have upped their investment in handheld computer specialist Belgravium Technologies as it forecasts a continued turnaround.

The managers lifted their stake in the business from five million shares to six million or 5.94% worth £300,000 at a share price of 5p, up 56.9% over 12 months versus a FTSE AIM return of 17.4%.

Belgravium is a top-ten position in the managers’ Chelverton Growth Trust. In results at the beginning of March, the company reported profits for 2013 up from £336,000 to £400,000.

It added that business had been backloaded to the second half of the year as the UK economy began to accelerate a little, and predicted further gains this year on the back of stronger activity.

Sales remain sluggish it said, but cost controls and improved margins were helping the bottom line. Broker WH Ireland uprated the company to a buy following the results, with a price target of 6.5p

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