Sunday Sharing Tips: Mitchells and Butlers, Facilities by ADF

The Sunday Times‘s Robert Watts thinks readers should be shares of Mitchells and Butlers.

In his column The Tipster, he said he believed the strong job market would help keep the taps “running well.”

“And while rising National Insurance, inflation and rising energy costs will squeeze consumer spending this year, a wave of abstinence seems unlikely,” he added.

Watts also noted the pub owner’s “sound” balance sheet, which at last count had £235m and undrawn credit of £150m.

He also praised management’s actions to shore up the company’s pension fund and the fact that Mitchelss & Butlers owned 80% of its freehold properties.

Moreover, analysts, like those at Jefferies, expected it to take market share in the current reopening thanks to its well-maintained fleet.

Its ownership of the All Bar One franchise also meant the company was “particularly” well placed to benefit from the end of the work-from-home orientation.

the Financial Mail on Sunday’s Midas column recommended readers to buy shares of Installations by ADF, pointing out that he was set to benefit from the rapid growth of his sector and that the United Kingdom was consolidating its position in the entertainment industry.

The UK itself has gained great appeal as a location for film studios. Film and TV brought nearly £12.5billion to the UK in 2021, a 24% increase over the past five years, and studios are being built across the country.

ADF’s facilities provided the state-of-the-art trucks and trailers used by the cast alongside the well-trained professionals required on film sets.

According to the tipster, the company’s shares, which floated on the AIM market in early June, “are expected to increase significantly” in value over the next five years and beyond.

Its list of big clients includes Amazon Prime, Disney, Warner Brothers, Netflix, BBC and Sky.

Midas also notes the positive share price performance of Brickability, which was introduced in September 2019 and is also chaired by John Richards.

CEO Marsden Proctor knows the industry inside out, having started in the facilities business 26 years ago as a driver.

Additionally, full-year sales are expected to have nearly doubled in 2021 and dividends are also on the cards and the plan is to boost sales to £100m in five years.

“Midas Verdict: ADF’s facilities may have an unusual name, but there’s nothing strange about the company itself,” Midas concluded.

“A well-known operator in a fast-growing industry, the company is ideally placed to benefit as the UK consolidates its position in the entertainment industry. As the business expands, shares should follow. At 63p , the stock is a buy.”

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