26th June 2014
As investors are set to benefit from the increased ISA – or NISA – limit of £15,0000 from the 1 July 2014, we look at three AIM shares that analysts are tipping right. But they are arguably only for the most intrepid of investors happy to play the long game.
Construction and materials group Breedon Aggregates is presently being tipped as a ‘buy’ by the wider market. The FTSE AIM 100 constituent has enjoyed a 60% share price rise in the past 12 months even though infrastructure spend having been generally dull. But despite the difficulties this has brought for companies to firms in the sector, at Breedon Aggregates margins have been improving, helped by lower costs, stable pricing and acquisitions.
Helal Miah, investment research analyst at The Share Centre says: “The company has been positioning itself to benefit from any pick up in the economy and demand for its products. A number of acquisitions have been made which should help expand its geographical presence in the UK and management expects these to make a significant and improving contribution. This is a smaller AIM listed company that is geared to a recovery in infrastructure spend and is for investors prepared to take a longer term view.”
The mobile telecommunications group and FTSE AIM 50 member, continues to see increasing demand for its services and believes it is on track to meet its 50% revenue growth target in 2014. Despite a massive 66% increase in its share price over the last year a flurry of brokers, including Goldman Sachs, have listed the group in ‘buy’ to ‘strong buy’ territory.
The business boasts leading blue chip partners and investors will be cheered by the news that the group has become the technology partner behind Yaap Shopping, the Spanish mobile commerce service launched by the alliance of CaixaBank, Santander and Telefónica. The new contract wins in Europe and the US demonstrates that the company is seeing multiple opportunities in all geographies.
Miah says: “The company continues to attract high calibre partners and customers, helping to firmly integrate its proposition as the preferred interface between financial institutions and their customers globally. Results continue to demonstrate that the group is heading in the right direction and so we recommend Monitise for a higher risk, early stage investment opportunity.”
Its stock maybe up 49% in the past 12 months but this small oil and gas exploration group will be prone to bouts of volatility given it operates in a potentially unstable regions, so it is not recommended for widows and orphans. All the same, the broker consensus is calling the shares a ‘strong buy’, with analysts at Investec among its fans.
The firm, according to The Share Centre’s Miah, has made significant progress in terms of exploration in recent years, turning exploration projects into productive assets. Production only began at its Platanillo field in southern Colombia in 2012 and has now reached to 7,000 barrels of oil equivalent per day.
Miah says: “Amerisur Resources’ fields are all set for more seismic and drilling activity and the company remains positive on their prospects. With production increasing at a rapid rate, the company is expected to build on last year’s performance with net margins predicted in the region of 45%. This is helped by the fact that the company has no debts on its books. With a forward price to earnings ratio and six times the valuation compares favourably against its peer group.”