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Authoritative Independent Monthly Share Selections Using Technical & Fundamental Analysis

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Secondary Recommendation

ScS Group - Confident debut from sofas and flooring group

March 2015

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.

  • Epic Code:
  • SCS
  • Price:
  • 196.75p
ScS Group, which sells sofas and flooring products, is very much in the feast or famine mould of companies that can perform exceptionally well with a favourable economic wind, while being at risk of a dramatic reversal in bad times. The company originally floated in 1997 and performed well until the credit crisis caused a collapse in demand, while the subsequent withdrawal of credit insurance from its suppliers led to a cash crunch. However, private equity firm Sun Capital bought it out for a nominal sum in June 2008 and aided by a £20m cash injection its fortunes have recovered. In the two years ended July 2014 sales have grown 24% to £258m while EBITDA has increased 78% to £13.7m. Demand for the shares, which were int ...

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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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