These stocks have got talent
Britain may have talent and diversity but so does the stock market. Popular financial website The Motley Fool - Fool.co.uk has scoured the stock market to unearth five shares that have the potential to deliver big profits in the coming years.The recent stock market rally has taken many investors by surprise and pundits are already betting it will end soon. However in the spirit of Susan Boyle, The Motley Fool has dug deep for little-known companies with talent. These companies are largely unrecognised, have grown their own profits during this recession, and are forecast to keep growing.
Company - Share Price - Market Cap - Forward P/E
Healthcare Locums - 180p - £188m - 7
Alterian - 98p - £56m - 7
London Capital Group - 173p - £68m - 6
Research Now - 330p - £61m - 10
SDL - 331p - £251m - 11
Prices taken as at 29 May 2009
The first three companies all have the added advantage of trading on very cheap forward price to earnings ratios (P/E). With Alterian, you are paying £7 for every pound of profit the software company is expected to make. The inverse of P/E is the earnings yield, and that ratio allows you to compare the potential returns to that of savings rates, bond yields or gilts.
David Kuo, Director at The Motley Fool comments: "If you think Susan Boyle missing out in the final of Britain's Got Talent was an upset, then think again. The stock market is littered with fallen growth stocks. Life goes on, especially in the world of investing.
"The best strategy for investors right now is to hunt for high-quality companies trading at cheap prices. These five companies should be a starting point for further research.
"As with reality TV, there are no guarantees in the world of investing. Although these companies appear to have talent today, it could be different in the future - that's the beauty of diversity."