Skip Header
Important information: The value of investments can go down as well as up so you may get back less than you invest. Investors should note that the views expressed may no longer be current and may have already been acted upon. This is a third-party news feed and may not reflect Fidelity’s views.

Sunday share tips: Inspiration Healthcare, BP Marsh

(Sharecast News) - Neonatal medical machine manufacturer Inspiration Healthcare shares had been on the slide since late 2021 amid distribution issues in China. The company had seen strong demand for its ventilators during Covid, but had that led to an overvaluation or was the medtech distributor now a bargain?

According to The Sunday Times's Lucy Tobin, it was the latter.

The market for neonatal intensive care was worth $6.8bn and expected to reach $10bn by 2027 due to growing demand, she pointed out.

Yes, results for the year to February had been less than inspiring, with underlying earnings down from £6m to £4m.

But the company had invested in new manufacturing capacity, had high-quality clients and revenues accelerated in the first two months of its 2024 year to nearly £2m.

Furthermore, its policy of reinvesting 9% of revenues into research and development should gradually pay off, Tobin judged.

"The price to earnings ratio is 9.6 for 2023, down from over 12 last year," she added.

"Inspiration is a dicey investment, but its medical technology's time has come: buy."

The Financial Mail on Sunday's Midas column tipped shares of BP Marsh to readers, highlighting the commpany's track record.

At the current price, the shares had "real potential", Midas believed.

BP Marsh was an investor in up and coming insurers, led by a well-respected industry veteran, Brian Marsch.

The firm typically invested up to £5m in exchange for stakes of between 20-40%, holding onto them for seven and a half years on average.

Just in the past six years, it had invested £27m upfront and made over £93m from their sale.

One of its investments will soon be acquired with BP Marsh looking to distribute £1m via a special divi or 2.78p per share.

That was on top of the regular payout of an identical amount.

It was also planning to spend £6m in share buybacks over three years, equating to an annual dividend of at least 5.56p.

The latest deal would leave the company with "plenty" of cash on its books and it was looking to grow its portfolio.

Should it do so wisely, that should lead to bigger profits and dividends as well as a rising share price.

"The firm has a track record of making money and there is every reason to believe it should continue doing so. Marsh and his team are extremely choosy about which businesses they support, they have decades of experience and the market is buoyant.

"[...] At £3.76, the stock is a buy."

Share this article

Related Sharecast Articles

Monday newspaper round-up: Renewable energy, BlackRock, Frasers Group
(Sharecast News) - A development company that sells off land no longer needed by Thames Water has paid out a £14m dividend despite warnings that it could become engulfed by the water group's financial woes. Accounts filed at Companies House show Kennet Properties paid out a £14.5m dividend in the year to 31 March 2023 despite the difficulties faced by the wider group, which is facing going into administration. - Guardian
Sunday share tips: Mitie, Costain
(Sharecast News) - The Financial Mail on Sunday's Midas column tipped shares of Mitie to its readers, highlighting it shift from facilities management to facilities transformation.
Sunday newspaper round-up: IDS, Ocado, Foxtons
(Sharecast News) - Asset manager Redwheel told regulators they should reduce the UK postal service's legal obligations. The move followed a failed buyout attempt by Daniel Kretinsky for International Distributions Services, its parent company. The billionaire investor was said to be evaluating a possible improved bid. The company meanwhile has petitioned Ofcom to let it cut the number of days per week during which it must deliver second-class mail from six to two or three. That would save the company £300m and see it shrink its workforce by 1,000. According to Redwheel, as first reported by the Sunday Times, the enforced costs of its legal obligations left the company "vulnerable to corporate predators". - Guardian
Friday newspaper round-up: Thames Water, Netflix, consumer confidence
(Sharecast News) - "Misleading" and "inconsistent" labels make it hard for shoppers to know where their food comes from, the consumer champion Which? has said, as it found supermarket chains were selling products with "meaningless" statements on their packaging. Retailers must supply the "country of origin" for specific foods including fresh fruit and vegetables, unprocessed meats, fish, wine and olive oil but the rules do not generally apply to processed meat or frozen or processed fruit and vegetables. - Guardian

Important information: This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice. When you are thinking about investing in shares, it’s generally a good idea to consider holding them alongside other investments in a diversified portfolio of assets. Past performance is not a reliable indicator of future returns.

Award-winning online share dealing

Search, compare and select from thousands of shares.

Expert insights into investing your money

Our team of experts explore the world of share dealing.