Primary Recommendation

Southern Cross - With debt concerns almost eliminated the shares look cheap on PE of 4.3

April 2009

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

In many ways Southern Cross, the UK's largest provider of residential care homes, is the perfect share to ride out the economic storm. The company provides a service that will never be cut back on, even in tough times but even better is the fact that its market is enjoying significant growth with favourable demographic trends leading to accelerated growth in the number of senior citizens using its services. Southern Crossâ€™ growth is also supported by Government imposed regulatory burdens, forcing many smaller rivals to exit the market as well as deterring any would be entrants. In spite of this attractive backdrop the shares have been hammered down to extremely low levels on concerns that Southern Cross took on more debt than it ...

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PZ Cussons - Imperial Leather owner set to increase profits to Â£100m in 2010

Southern Cross - Fee rises support margins (October 2009)

Southern Cross - Portfolio constituent hits six-month high (June 2009)

Southern Cross - Dramatic recovery in finances means care homes operator looks over-sold (March 2009)

Southern Cross (October 2008)

Southern Cross - Shock profit warning (August 2008)

Southern Cross - 5.8% increase in fees (July 2008)

Southern Cross (April 2008)

Southern Cross - Underlying occupancy over 92% (November 2007)

Southern Cross - Divests freehold for Â£30m (October 2007)

Southern Cross (July 2007)

Southern Cross (June 2007)

Southern Cross (May 2007)

Southern Cross - Blackstone exit triggers re-rating (April 2007)

Southern Cross (February 2007)

Southern Cross - Largest provider of care homes exhibits strong demand profile (November 2006)

With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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