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Hollywood Bowl (LON:BOWL)

  • Share price: 186.5p (+1%)
  • No. of shares: 150 million
  • Market Cap: £280 million

Trading Update

I last covered this ten-pin bowling operator at its H1 results earlier this year.

Like-for-like sales for that period were only up 1,2%, but the company said it had lost 2% due to unusually dry weather.

According to this update, like-for-like revenue growth for the full year is 3.5% - so H2 must have been a lot better. Total revenue, including new sites, is up 8.9% year-on-year.

Earnings are set to be marginally ahead of Board expectations.

It continues to hint at dividends:

Hollywood Bowl's business model means that it is able to sustain its investment programme going forward through its ongoing cash generation.  Therefore, as initially noted in April at the Group's half year trading update, the Board is considering returning capital to the Group's shareholders.

My opinion: This only listed in September 2016, and with the mess at Accrol Group (LON:ACRL) fresh in the memory, investors are right to be sceptical about the quality of some recent flotations.

But every stock should be treated on its own merits and this is a more interesting proposition. Offering modest but self-funded growth, it looks promising to me. Stockopedia computers appear to agree, giving it a StockRank of 63.

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Motorpoint (LON:MOTR)

  • Share price: 142p (+5%)
  • No. of shares: 100.2 million
  • Market cap: £142 million

Trading Update

This used car supermarket (specialising in cars less than two years old) listed on the main market last year at 200p. Results for the previous financial year (ended March 2017) were marred by the operating expenses at four new sites.

Things are getting back on track now, as those sites have matured:

The Group has delivered more normalised margin levels in the first half compared to the same period last year, and the breadth and quality of stock on hand going into the second half of the year is encouraging.

 Underlying H1 PBT is set to be c. £10.5 million (vs. £6.4 million last year)

This sector as a whole is unloved, and it's understandably difficult to built an economic moat. Hence the cheap pricing.…

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