Share price: 173p (-6.5%)
No. shares: 128.2m
Market cap: £222m

Completion of Placing

(I have a long position in GYM.)

It was helpfully pointed out in the comments last night (by rhomboid1) that two private equity backers of The Gym intended to sell down the rest of their stakes.

It's a large placing for 30.5% of the company and has now been completed at 175p, about a 5% discount to yesterday's closing price.

Unsurprisingly, the share price has dropped today to around (just below) the placing price.

One of the technical hazards when investing in recent IPOs is that an overhang of stock can continue for some time. 

Of course, if you think the shares are good value, this can be the basis of your opportunity to keep buying.

The problem is that insiders and private equity backers tend to know the most about the companies they are selling to the public markets, and so it's difficult for public market investors to come off on the right side of the deal.

Anyway, I think the overhang has been cleared now as far as The Gym is concerned.

Though I personally run a very concentrated portfolio when it comes to my biggest holdings, I am very cautious with growth stocks and recent IPOs. So The Gym currently represents only about 1% of my portfolio. But as time passes and as the investment thesis develops, I hope it will prove worthy of adding to.


Share price: 307.5p (-2.5%)
No. shares: 129.6m
Market cap: £399m

Q1 Trading Update

SThree reports a flat performance in Q1 at constant currencies, or up 12% in GBP terms.

This is a global STEM recruitment group with its heaviest weighting in Continental Europe (nearly half of gross profits).

I last reported on it in January, at the results for the year to November 2016. Those results showed gross profit increasing by just 2% against 2015.

The lack of overall growth makes it fairly uninteresting in some ways, but I think it's still pretty easy to defend investing here.

The international/sector diversification it enjoys means that it's flexible to allocate resources where there are the best opportunities, making it less risky than some other players in the recruitment sector.

This helps to explain why it current enjoys a 14x PE ratio (versus the likes of

Unlock the rest of this Article in 15 seconds

or Unlock with your email

Already have an account?
Login here