Good morning!

Thanks for all the positive feedback about yesterday's report - it's good to know that people find these reports useful.


There has been far too much partisan nonsense about this issue, which I largely ignore, because it's at best a waste of time, or worse still, misleading. So for me, it's now all about listening to experts, and trying to work out what is most likely to happen next.

There was a fantastic programme on Radio 4 yesterday, where 3 professors in law discussed how Brexit might work out in practice. It also clarifies some of the complex issues, which I found extremely helpful. Highly recommended - the iplayer link is here.

A consensus seems to be developing that the most likely outcome is for the UK to go down the Norway route - i.e. full access to the single market, for a fee. I'm not interested in discussing the rights or wrongs of this. The only issue for our purposes here, is how it might affect our shares.

Going down that route would undoubtedly be positive for shares, and I think this is what's driving the current rally - i.e. a realisation that the world is not going to end, and business will probably continue pretty much as normal.

Set against that, as I mentioned yesterday, the economy is likely to slow down in H2 of this year. So plenty of profit warnings to come, for UK-focused companies I think. If the market thinks that a prolonged recession is likely, then the price drops will be brutal. However, if the market thinks a slowdown might be short-lived, then it will start to look through poor current performance, and factor in a recovery next year. We'll have to keep monitoring events closely to determine which is happening.

IG Design (LON:IGR)

Share price: 163.5p
No. shares: 59.3m
Market cap: £97.0m

(at the time of writing, I hold a long position in this share)

Results, y/e 31 Mar 2016 - I read these numbers on my iPad in bed earlier, and was impressed - a good solid set of figures, and reasonable outlook comments too.

Adjusted fully diluted EPS is up 15% to 13.2p.

The PER is 12.4 which seems reasonable to me.

We have to be very careful with PERs at the moment. Since there is considerable economic uncertainty, we cannot just assume that earnings will continue rising…

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