19 stock ideas from fund manager Oliver Brown of RC Brown

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18th Feb '23 by Paul Hill

22 comments 2391 reads

In this upbeat interview, 1st class fund manager Oliver Brown of RC Brown Investment Management PLC takes me through:

His outlook for equities . Start
Strix Group plc. 02:30
Surface Transforms Plc. 04:55
GSK. 06:20
Animalcare Group. 07:55
Sondrel. 09:30
Fonix Mobile. 11:45
Saietta Electric Drive. 13:50
GBG Plc. 16:15
Banking sector & HSBC. 18:05
Eneraqua Technologies Tech. 19:55
Building products, Lords Group Trading & Brickability Group PLC. 21:35
FMCG stocks, Unilever & Diageo. 24:30
Hotel Chocolat. 26:35
Supreme PLC. 29:10
Oil & gas industry & Shell. 30:35
Ashtead Technology. 33:30
#miners & Rio Tinto. 34:55
How to invest in RC Brown Investment Management PLC’s funds.38:05

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About the Author

Paul Hill

Premium Member

22 comments

Rusty2

19th Feb '23

Yes plenty of stocks to consider. Looking at Strix (LON:KETL) debt has risen, dividend likely to be cut and margins have fallen over the last 5 years but it does look good value. It has been reviewed on the SCVR recently. Paul Scott was pretty negative about it. Do you know why they have been paying low tax? China is opening up but Covid is now rife there, if it can get over Covid then should see growth. The last acquisition is forecast to reduce eps considerably and could be high risk, their product is very expensive. Not very green either, I would be interested to see how many kW they consume per day.

Paul Hill

19th Feb '23

Great questions Rusty2.

I've now idea wrt the Chinese tax - albeit I guess it may be if #KETL are also manufacturing their kettle controls locally, & then selling (re 0% export tax) the goods worldwide?

Rusty2

19th Feb '23

I think it is UK corporation tax, for some reason it has been low, maybe they can offset it? The question is will it remain low or was it just recently? Paul Scott has commented about this, he is very good on balance sheets.

Rusty2

19th Feb '23

GB (LON:GBG) I did hold this last year, .I was very lucky to get out around 625p, I will have another look at this.

BnB

19th Feb '23

Strix (LON:KETL) is registered in the Isle of Man. No corporation tax there.

richardho

19th Feb '23

Based in Isle of Man, I believe

BnB

19th Feb '23

GB (LON:GBG) I’ve had an almost identical journey. Sold out in the low 600s. Back in around 325. I like the company, market exposure and valuation. Also crypto is clawing out of the doldrums which might give a boost to Know Your Customer revenues.

Paul Hill

19th Feb '23

Another interesting stock that Oliver mentioned is GB Group.

It has come down a long way from its highs (now 340p) and received takeover interest from private equity only last Sept'22 at well over 500p/share.

Rusty2

19th Feb '23

Strix (LON:KETL) Good point, surprised Scotty missed that. Looks ok, not totally convinced, a few red flags. I have some funds from K3 Capital (LON:K3C^B23) and Crestchic (LON:LOAD) to invest. Some has gone into Watkin Jones (LON:WJG). Have been selling some retailers that have bounced in the last few months. Holiday sector may take off?

Paul Hill

19th Feb '23

Presumably GBG will also get a big boost from the US' online gambling boom (re age verification, etc)?

Rusty2

19th Feb '23

Eneraqua Technologies (LON:ETP) not look at this one before, from a quick glance only negative I can see, is 2 large director sales, but they still have large holdings.

Paul Hill

19th Feb '23

Agreed - #ETP looks to be a top quality firm IMO, & not expensive either trading on 11x FY23 PER. Singers have a 396p/share TP.

BnB

19th Feb '23

Eneraqua Technologies (LON:ETP) I’m recently into this one. Hard to estimate the potential for competition to disrupt them but plenty of drivers for expansion of its market. Management come across well - unflashy and conscientious.

Paul Hill

20th Feb '23

Jamie Constable at Singers speaks highly of them too

Rusty2

20th Feb '23

Eneraqua Technologies (LON:ETP) problem is buying any, most I can buy is 1 share. Price has shot up and spread has widened. I will try a different broker.

sharw

20th Feb '23

Paul - next time you talk with Oliver Brown it would be interesting to ask him about R C Brown's unique style, which is not to buy in the market, even though that does not help us mere PIs!

https://www.rcbpo.co.uk/our-ap...

sharw

20th Feb '23

Supreme (LON:SUP)

Oliver said that its big customers were the likes of B&M and Poundland. Not necessarily - their main vaping own brand, 88vape, is sold in Sainsburys, Asda and Morrisons. Only Tesco to go although Tesco does sell 28 different lines of batteries from SUP.

He mentioned SUP getting over the blip in the lighting division caused by destocking. A lot of people don't realise why this had such a drastic effect on the P&L a/c and it is important to understand the nature of this. Supreme hold exclusive licences for Eveready , JCB and Energiser. This means that apart from supplying small retailers from their own warehouse they supply the big boys by the containerload. They simply order from China and the container goes directly to the customer so profits go straight to the bottom line. It is no wonder that these customers stocked up in the period of uncertainty of getting containers from China to the UK (and then through the Tilbury bottleneck) and equally no surprise that now that has eased they are destocking. A good example of a big customer here is B+Q stocking 74 different Energiser bulbs: https://www.diy.com/search?ter...

Paul Hill

20th Feb '23

Thanks - will do

Rusty2

21st Feb '23

GB (LON:GBG) profit warning today. I was looking into buying some, but was out off by the high debt, so did buy any, lucky miss. Shares are down 10%.

BnB

21st Feb '23

GB (LON:GBG) profit warning today. I was looking into buying some, but was out off by the high debt, so did buy any, lucky miss. Shares are down 10%.

It’s quite a volatile name. Down 10% (now only 7% as I type) is not unusual for a daily move anyway. Yes, there are risks, but I’m a buyer at these levels. This was a much milder warning than previously - hence the muted share reaction so far - suggesting that they are working through their issues. And e-Commerce will come back!

Update: now almost flat on the day.

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19 stock ideas from fund manager Oliver Brown of RC Brown

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About the Author

Paul Hill

22 comments

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