Private Investor: How a hangover cure can make you richer as well

Sometimes you just look at a share price and think " how the heck did that happen?" Sometimes that's bad, of course, and you find yourself wondering how those BT shares that were at £15 just a couple of years ago subsided to 180p.

Sometimes you just look at a share price and think " how the heck did that happen?" Sometimes that's bad, of course, and you find yourself wondering how those BT shares that were at £15 just a couple of years ago subsided to 180p.

It took me too long to get shot of that stock and I don't regret buying into Serco instead. They haven't moved yet, but I'm confident of steady progress for this fast-growing company in the months ahead.

If anything, Serco may even benefit from any pressures on public spending that arise on the other side of the General Election. The Government is ideologically committed to the notion that the private sector always and everywhere delivers better value for money, so if public spending needs to be reined in, what better way to get value for money than to invite firms like Serco to bid for more and more chunks of the state sector that were previously though untouchable?

If public spending is instead protected and taxes rise then there again Serco will be one of the few winners in a corporate sector that may find itself being squeezed by the Chancellor. So, a good each way bet, I would have thought.

The real surprise for me over the past couple of months has been the performance of AG Barr. I find it amazing. This medium-sized company - market capitalisation is £182m - is best known for its Irn Bru and Tizer soft drinks, and also makes Orangina under licence.

Nothing too exciting there you might think , even though it enjoys market leadership in Scotland, just about the only place in the world where Coca-Cola doesn't enjoy the number one spot.

It's a fairly old fashioned company - in the best sense of the term, with a strong family interest, a fine sense of tradition and heritage for its brand and what appears to be a paternal approach to its staff.

There is nothing stand-still, though, in its approach to business, and it has been expanding aggressively in England with some novel advertising campaigns. Now it is bearing down on costs by investing £17m in a new centralised sales, distribution and marketing location. Well, Irn Bru doesn't sell itself, you know, even if I can vouch for its excellent qualities as a hangover palliative...

Last week's results statement showed things are as strong as ever, with full-year pre-tax profits up by 13 per cent and another increased dividend.

Shares in AG Barr have gone up by about 40 per cent in the past year, way better than the market as a whole, the beverages sector or, indeed, my stagnating investment in Coca-Cola. At almost £10 a share they stand at rather more than double the price I paid for them in 2002.

Outstanding as the share price record has been, Irn Bru is actually not so untypical of the FTSE 250 mid caps as a whole which, as has been noted already, have out-run their much larger FTSE 100 counterparts.

It reminds me a bit of the mittlestand, that bloc of medium-sized enterprises that used to be such a pillar of the German economic miracle. Now it seems to be British companies of a certain size that are the powerhouse of the UK's economic revival. Gordon Brown, who as a good Scotsman must have been brought up on the Bru, messes with these mid caps at his peril.

At this point, I ought to mention my speculative investments in two volatile small caps, Sportingbet and Matrix Communications. After a very strong run, they've both headed quite badly south recently.

I'm still in the money with both of them, however, even though Sportingbet is at around 260p, well down from its 350p peak (it started the year at 180p, though). Similarly, Matrix stands at 170p, down from a February peak of 230p. I'm not quitting yet, though.

s.o'grady@independent.co.uk

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

Finacial products from our partners
Property search
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    SThree: Trainee Recruitment Consultant

    £20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...

    Ashdown Group: IT Manager / Development Manager - NW London - £58k + 15% bonus

    £50000 - £667000 per annum + excellent benefits : Ashdown Group: IT Manager / ...

    Recruitment Genius: Sales Consultant / Telemarketer - OTE £20,000

    £13000 - £20000 per annum: Recruitment Genius: Scotland's leading life insuran...

    Ashdown Group: Training Programme Manager - City, London

    £40000 - £45000 per annum + benefits : Ashdown Group: Training Programme Manag...

    Day In a Page

    Where the spooks get their coffee fix: The busiest Starbucks in the US is also the most secretive

    The secret CIA Starbucks

    The coffee shop is deep inside the agency's forested Virginia compound
    Revealed: How the Establishment closed ranks over fallout from Loch Ness Monster 'sighting'

    How the Establishment closed ranks over fallout from Nessie 'sighting'

    The Natural History Museum's chief scientist was dismissed for declaring he had found the monster
    One million Britons using food banks, according to Trussell Trust

    One million Britons using food banks

    Huge surge in number of families dependent on emergency food aid
    Excavation at Italian cafe to fix rising damp unearths 2,500 years of history in 3,000 amazing objects

    2,500 years of history in 3,000 amazing objects

    Excavation at Italian cafe to fix rising damp unearths trove
    The Hubble Space Telescope's amazing journey, 25 years on

    The Hubble Space Telescope's amazing journey 25 years on

    The space telescope was seen as a costly flop on its first release
    Did Conservative peer Lord Ashcroft quit the House of Lords to become a non-dom?

    Did Lord Ashcroft quit the House of Lords to become a non-dom?

    A document seen by The Independent shows that a week after he resigned from the Lords he sold 350,000 shares in an American company - netting him $11.2m
    Apple's ethnic emojis are being used to make racist comments on social media

    Ethnic emojis used in racist comments

    They were intended to promote harmony, but have achieved the opposite
    Sir Kenneth Branagh interview: 'My bones are in the theatre'

    Sir Kenneth Branagh: 'My bones are in the theatre'

    The actor-turned-director’s new company will stage five plays from October – including works by Shakespeare and John Osborne
    The sloth is now the face (and furry body) of three big advertising campaigns

    The sloth is the face of three ad campaigns

    Priya Elan discovers why slow and sleepy wins the race for brands in need of a new image
    How to run a restaurant: As two newbies discovered, there's more to it than good food

    How to run a restaurant

    As two newbies discovered, there's more to it than good food
    Record Store Day: Remembering an era when buying and selling discs were labours of love

    Record Store Day: The vinyl countdown

    For Lois Pryce, working in a record shop was a dream job - until the bean counters ruined it
    Usher, Mary J Blige and Will.i.am to give free concert as part of the Global Poverty Project

    Mary J Blige and Will.i.am to give free concert

    The concert in Washington is part of the Global Citizen project, which aims to encourage young people to donate to charity
    10 best tote bags

    Accessorise with a stylish shopper this spring: 10 best tote bags

    We find carriers with room for all your essentials (and a bit more)
    Paul Scholes column: I hear Manchester City are closing on Pep Guardiola for next summer – but I'd also love to see Jürgen Klopp managing in England

    Paul Scholes column

    I hear Manchester City are closing on Pep Guardiola for next summer – but I'd also love to see Jürgen Klopp managing in England
    Jessica Ennis-Hill: 'I just want to give it my best shot'

    Jessica Ennis-Hill: 'I just want to give it my best shot'

    The heptathlete has gone from the toast of the nation to being a sleep-deprived mum - but she’s ready to compete again. She just doesn't know how well she'll do...