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4 shares the pros are buying and selling

Our regular roundup of trades by professional investors, featuring Revolution Bars, WYG, City Pub Group and Eve Sleep.

by Selin Bucak, David Campbell on Dec 04, 2017 at 05:00

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Key stats
Market capitalisation£83m
No. of shares out50m
No. of shares floating45m
No. of common shareholdersnot stated
No. of employees2743
Trading volume (10 day avg.)m
Turnover£130m
Profit before tax£14m
Earnings per share8.22p
Cashflow per share19.39p
Cash per share8.67p

Revolution Bars

Citywire AAA-rated Keith Ashworth-Lord has upped his stake in bar operator Revolution Bars Group (RBG) after a 25% decline in the company’s share price this year.

The manager took his holding from 5.2% to 6.2% of the company worth £5.2 million at a share price of 167p, up 51.55% over six months.

The majority of the shares are held in Ashworth-Lord’s CFP SDL UK Buffettology fund, with the rest held in the CFP SDL Free Spirit Fund managed by Rosemary Banyard.

Revolution Bars Group recently revealed that it is set for three new openings before Christmas, increasing its portfolio to 72 locations across the UK.

Ashworth-Lord first added the business to his portfolio back in January, commenting at the time: ‘The beauty of the business model is very high rates of return of around 40% on capital invested in the new openings, equating to a 2.5 year pay-back. The expansion is being funded internally from the strong operational cash flow of the business and the balance sheet sports net cash.’

Key stats
Market capitalisation£27m
No. of shares out73m
No. of shares floating65m
No. of common shareholdersnot stated
No. of employees1568
Trading volume (10 day avg.)m
Turnover£151m
Profit before tax£6m
Earnings per share3.30p
Cashflow per share8.64p
Cash per share9.33p

WYG

Citywire AA-rated micro-cap star Philip Rodrigs appears to be losing some patience with the recent slump in the valuation of environmental consultancy WYG (WYGR).

Rodrigs cut his holding in the stock from 5.6% of the shares to 4.9% worth £1.4 million at a share price of 37.5p, down 72% from a high of 136p in January.

The position is held within his £112 million River & Mercantile UK Micro Cap (RMMC) investment trust, where it was a drag on performance in an otherwise solid third quarter.

‘WYG, under new management, warned on trading again and fell 30.7% to a very vulnerably low valuation,’ he wrote in a recent fund update.

Having tumbled in August the stock was once again sliding last week after it warned full-year profits would be ‘substantially lower’ than previously expected.

Broker FinnCap rates the business a ‘buy’ on a price target of 80p.

Key stats
Market capitalisation£141m
No. of shares out139m
No. of shares floating70m
No. of common shareholdersnot stated
No. of employees51
Trading volume (10 day avg.)m
Turnover£12m
Profit before tax£-11m
Earnings per share-8.20p
Cashflow per share-8.19p
Cash per share3.35p

Eve Sleep

Neil Woodford has topped up his stake in online mattress company Eve Sleep (EVEE) after a choppy six months for the shares following their flotation in May.

Woodford already held a 17.5% stake in the business before its IPO on the Alternative Investment Market earlier this year, and has been steadily building his stake.

Last week he took his stake in the company to 28.2%, worth around £39.7 million at a share price of 101.5p, only just higher than the 101p at which the shares floated. Woodford holds most of his shares in his flagship Woodford Equity income fund.

The shares have been on a rocky ride, falling to around 80p in early September before hitting a peak of 107p at the end of that month.

Berenberg last week initiated coverage on the stock with a ‘buy’ rating and 140p target price. Joseph Barron said the stock had ‘several characteristics of a successful disruptor’.

‘It operates in a large market that has lacked innovation; it makes use of novel marketing strategies; and it is led by an impressive management team,’ he said.

City Pub Group

Citywire AA-rated ‘micro-cap’ stock picker Chris Hutchinson has taken a chunky stake in upscale drinks purveyor City Pub Group (CPC), as it enters public trading at 170p a share, raising £35 million.

Hutchinson transferred the majority of his pre-listing stake, equivalent to 7.9% of shares or 4.5 million worth £8.1 million at the 181p the shares climbed to after entering the market.

The holding is primarily owned by his £188 million Unicorn AIM VCT with smaller stakes in his Outstanding British Companies and colleague Fraser Mackersie’s UK Growth funds.

City Pub Group owns a 34-strong chain of posh pubs across the south of England. The fund raising will enable the group to kickstart what is hoped to be a sustained expansion, with executives saying they could plausibly double the business within the next four years.

Executive chair Clive Watson was a founder of the Capital Pub Company which was sold to Greene King in 2011 for £93 million.

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  • Revolution Bars Group PLC (RBG.L)
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  • WYG PLC (WYGR.L)
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  • eve Sleep plc (EVEE.L)
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