The global economy looks weak, the odds of a global recession are shortening. But long-term investors need to look beyond the economic cycle, and find quality stocks.
Who were the stars of the FTSE 350 last year, and are they still stars?
Today I am looking at the FTSE 350, and what better place to start than the top ten FTSE 350 performing companies last year.
The index
In times of economic stress look towards quality.
As a rule, when sterling is down, companies which do most of their trading in overseas currencies benefit, at least they benefit relative to the pound. Typically, the FTSE 100 is a better place to find such companies than the FTSE 350.
But I can see no obvious difference in recent performance. Both indexes are up roughly 10 per cent over the last five years, both hit all time highs in January 2018 and moved back to around that level again in May last year, but are now roughly 10 per cent down from peak.
You could drill down and find the companies that primarily trade in overseas currencies, but that isn’t a long-term approach.
The FTSE 350 stars of 2018
So, who were the stars of 2018?
Here is a list with their starting, end price and percentage gain last year.
|
2018 start price (£)
|
2018 end price (£)
|
Percentage change
|
|
|---|---|---|---|
| Ocado Group | 3.98 | 7.79 | 96 |
| Hikma Pharmaceuticals | 11.49 | 18.45 | 61 |
| Evraz plc | 3.44 | 4.80 | 40 |
| Jardine Lloyd Thompson | 14.04 | 18.97 | 35 |
| Drax Group | 2.69 | 3.63 | 35 |
| Syncona | 2.02 | 2.63 | 30 |
| QinetiQ | 2.31 | 2.93 | 27 |
| Pearson | 7.42 | 9.40 | 27 |
| Ei Group | 1.46 | 1.84 | 26 |
| Auto Trader | 3.60 | 4.48 | 24 |
In more detail:
|
What they do
|
Comments
|
|
|---|---|---|
| Ocado Group | Online grocery | Share price rose as it agreed multiple partnerships globally, deal with US company Kroger a key moment |
| Hikma Pharmaceuticals | Multinational pharmaceutical | Rebounded from poor 2017 with strong new products |
| Evraz plc | Russian steel and mining company | Strong demand for steel more than offset fears of how economic sanctions against Russian economy. But will aggregate demand slump in the event of global recession? |
| Jardine Lloyd Thompson | Insurance | Was acquired by Marsh & McLennan |
| Drax Group | Electrical power generation | Provides around six per cent of the UK’s electricity— thanks to electric cars, IoT, the cloud and and other tech requirements, demand for electricity is likeky to rise significantly over the next few years and decades |
| Syncona | Investment Trust | Invests in privately owned biotechs. As a major shareholder, benefited from IPO of Autolus Therapeutics. |
| QinetiQ | Multinational defence technology | Has a £3.1bn order backlog |
| Pearson | Education publishing, former owner of the Financial Times | Has been shifting to e-learning |
| Ei Group | Pub company | Due to be purchased by Slug and Lettuce owner Stonegate Pub Company |
| Auto Trader | Automotive classified advertising | Has made an impressive shift to digital |
Share price performance this year:
|
2018 end price (£)
|
Share price 16 August 2019
|
Percentage change this year
|
|
|---|---|---|---|
| Ocado Group | 7.79 | 11.36 | 46 |
| Hikma Pharmaceuticals | 18.45 | 19.84 | 8 |
| Evraz plc | 4.80 | 4.98 | 4 |
| Jardine Lloyd Thompson | 18.97 | - | - |
| Drax Group | 3.63 | 2.67 | minus 26 |
| Syncona | 2.63 | 2.30 | minus 13 |
| QinetiQ | 2.93 | 2.69 | minus 8 |
| Pearson | 9.40 | 8.06 | minus 14 |
| Ei Group | 1.84 | 2.81 | 52 |
| Auto Trader | 4.48 | 5.17 | 15 |
These views are those of the author alone and do not necessarily reflect the view of The Share Centre, its officers and employees
Michael Baxter
Economics Commentator
Michael is an economics, investment and technology writer, known for his entertaining style. He has previously been a full-time investor, founder of a technology company which was floated on the NASDAQ, and a director of a PR company specialising in IT.
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