The Investment Column: Premium pork producer Cranswick back on form and worth biting into


Our view: Buy

Share price: 564.5p (+31p)

The TV chef Jamie Oliver reckons that Sainsbury's customers should buy the supermarket's fresh fruit, vegetables and all the other things that are good for you. Holders of shares in pork producer Cranswick, which supplies Sainsbury's with its "taste the difference" range, would urge customers to buy sausages.

After Cranswick issued an update yesterday, watchers reckon things are getting better for the group after it published what some analysts took to be a worrying trading statement earlier in the year. The firm was worried about its ability to pass on the increasing cost of commodities to its customers, but according to watchers at Panmure Gordon, things are now in better order. "Having disappointed the market with its Q3 trading update in January, today's announcement of the Q4 performance sees the company reporting continued strong sales," they say.

The company's chairman Martin Davey says that there is always a time lag associated with passing these costs on and the company has now managed to do that in its primary processed pork business.

Analysts at Shore Capital reckon that the problems were associated with a lack of "visibility", but that has now also been resolved. "Management has confirmed that the full-year performance will be in-line with market expectations, and hence we leave our 2008 and 2009 forecasts unchanged," they say.

Despite what turned out to be a temporary issue on costs being resolved, the company does face other problems. The firm is generally thought to be at the upper end of the pork market, which Mr Davey reckons will insulate it from the worst effects of any credit crisis-related downturn. He may well be right, but there is an alternative argument that suggests customers faced with the need to do a bit of financial belt-tightening may opt for ordinary sausages rather than the premium range.

The group also imports meats from Italy for its charcuterie range. As it buys in euros and sells in sterling, the exchange rate is like to make a £600,000 dent in profitability this year.

Cranswick is over its early year wobble when its share priced dropped from 769p on 31 January to 560p just five days later. Better sentiment will see the stock rise. Buy.

Akers Biosciences

Our view: Buy

Share price: 13.75p (+0.25p)

The last 12 months have been something of a revelation for Akers Biosciences. The AIM-listed group develops and makes diagnostics products, including alcohol breath-testing devices, which it sells to the US military.

By the group's own admission, until last year the scientists were in charge. "The firm was great at creating science," says Tom Nicolette, Akers' chief executive. "We had government FDA approvals in place and have had $60m of investment since 2002. It was a real commercial opportunity."

The firm's annual results published yesterday show that the group is making progress. Revenues were up to $5.5m, versus just over $1m in 2006, with loses cut to $2.4m from more than $10m the year before.

Much of the change has been down to the take up of two products that have now received their US patents. Each department of the US military now buys the firm's breathscan system, which shows soldiers if they are sufficiently sober to use weapons. Health workers are buying up the firm's system for detecting blood clotting among potential users of the drug Herperin, which is supposed to thin the blood, but in some cases has done precisely the opposite, leading to the deaths of patients.

Analysts at Arbuthnot recommend a "strong buy", suggesting that Akers' strategy of targeting "carefully chosen key markets where existing tests do not effectively fulfil clinical... requirements," is on fire. Investors should note that Arbuthnot is the group's house broker.

The company reckons its strategy of protecting its technology through patent is crucial and that it has already taken action to prevent competitors copying it.

Independent analysts reckon the fact that the US military has contracted with the group "is not bad at all", and that investors should be interested. The firm's share price has fallen steadily from 71.5p last May, and that's a worry, but also potentially gives investors the hope of a good run. Buy.

Charles Taylor Consulting

Our view: Buy

Share price: 268p (+4p)

In a world worried about the credit crisis, investors know they should be seeking steady, defensive stocks to stave off the worst of the crunch.

And they don't come much steadier than Charles Taylor Consulting, which has been providing services to the insurance industry, in one form or another, since the 19th century. In short, the group, which posted a record £13.6m profit yesterday, is involved in a number of industries, from offering consultancy and investment services to mutuals to taking on troubled insurance firms and realising their value.

The firm faces several risks that analysts point out. The weak dollar is a big problem given the amount of business the firm does in the United States. Watchers at Dresdner Kleinwort recommend investors "cut" the stock, saying that foreign exchange rates are bad enough for the bank to cut its target share price from 500p to 425p. Dresdner does point to the progress being made by the firm, which increased revenues by 3 per cent last year to £81.5m.

The group targets stable improvements and chief executive John Rowe points to the long-standing relationships it has with its clients as a reason to back the stock. Buy.

Start your day with The Independent, sign up for daily news emails
ebookA unique anthology of reporting and analysis of a crucial period of history
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

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

iJobs Job Widget
iJobs Money & Business

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + competitive: SThree: Did you know? SThree is a mul...

Guru Careers: C# Project Team Lead

£55 - 65k (DOE): Guru Careers: A unique opportunity for a permanent C# Develop...

Guru Careers: Graduate Editor / Editorial Assistant

£16 - 20k: Guru Careers: A Graduate Editor / Editorial Assistant is needed to ...

Guru Careers: Software Developer / C# Developer

£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...

Day In a Page

Raif Badawi: Wife pleads for fresh EU help as Saudi blogger's health worsens

Please save my husband

As the health of blogger Raif Badawi worsens in prison, his wife urges EU governments to put pressure on the Saudi Arabian royal family to allow her husband to join his family in Canada
Birthplace of Arab Spring in turmoil as angry Tunisians stage massive sit-in over lack of development

They shall not be moved: jobless protesters bring Tunisia to a halt

A former North African boom town is wasting away while its unemployed citizens stick steadfastly to their sit-in
David Hasselhoff's new show 'Hoff the Record': What's it like working with a superstar?

Hanging with the Hoff

Working with David Hasselhoff on his new TV series was an education for Ella Smith
Can Dubai's Design District 'hipster village' attract the right type of goatee-wearing individualist?

Hipsters of Arabia

Can Dubai’s ‘creative village’ attract the right type of goatee-wearing individualist?
The cult of Roger Federer: What is it that inspires such obsessive devotion?

The cult of Roger Federer

What is it that inspires such obsessive devotion?
Kuala Lumpur's street food: Not a 'scene', more a way of life

Malaysian munchies

With new flights, the amazing street food of Kuala Lumpur just got more accessible
10 best festival beauty

Mud guards: 10 best festival beauty

Whether you're off to the Isle of Wight, Glastonbury or a local music event, we've found the products to help you
Unai Emery’s passion for winning and eye for a bargain keep Seville centre stage in Europe

A Different League

Unai Emery’s passion for winning and eye for a bargain keep Seville centre stage in Europe, says Pete Jenson
Amir Khan and James DeGale’s remarkable Olympic performances were just the start of an extraordinary journey - Steve Bunce

Steve Bunce on Boxing

Amir Khan and James DeGale’s remarkable Olympic performances were just the start of an extraordinary journey
Abuse - and the hell that came afterwards

Abuse - and the hell that follows

James Rhodes on the extraordinary legal battle to publish his memoir
Why we need a 'tranquility map' of England, according to campaigners

It's oh so quiet!

The case for a 'tranquility map' of England
'Timeless fashion': It may be a paradox, but the industry loves it

'Timeless fashion'

It may be a paradox, but the industry loves it
If the West needs a bridge to the 'moderates' inside Isis, maybe we could have done with Osama bin Laden staying alive after all

Could have done with Osama bin Laden staying alive?

Robert Fisk on the Fountainheads of World Evil in 2011 - and 2015
New exhibition celebrates the evolution of swimwear

Evolution of swimwear

From bathing dresses in the twenties to modern bikinis
Sun, sex and an anthropological study: One British academic's summer of hell in Magaluf

Sun, sex and an anthropological study

One academic’s summer of hell in Magaluf