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Authoritative Independent Monthly Share Selections Using Technical & Fundamental Analysis

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Prezzo - Forecasts upgraded

October 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.

  • Epic Code:
  • PRZ
  • Price:
  • 32p
Rumours of the death of the mid-market casual dining sector now seem premature after Prezzo revealed robust interims, leading to forecasts being upgraded. The shares responded by spiking back up to 32p. For the six months to 28 June Prezzo increased revenues by 5.5% to £43.7m, while adjusted pretax profit fell just £0.1m to £5.1m. Eps remained virtually unchanged at 1.54p. The main story behind these results was that thanks to strong cost control Prezzo was able to minimise the decline in branch profit margin to 13.5%, down from 14.3% in 2008. This was achieved in spite of being forced to implement an element of promotional activity as well as contend with a change in the law, which means it cannot use tips to fund emplo ...

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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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