Short term investors recommended taking the profits on Axis-Shield

As Axis-Shield's share price soars in early morning trading The Share Centre downgrades the company to a ‘sell'. Nick Raynor, investment adviser at The Share Centre, explains why:

"Just a day after Axis-Shield issued a trading update revealing it was on target to meet forecasts for the year it has turned down a bid from US listed company Alere Inc. The offer of 460p in cash was immediately rejected as Axis-Shield believed this offer did not reflect the true value of the company.

"The share price increased by 136p to 472p this morning and is now at a 40% premium from the closing price yesterday. We are recommending short term investors take the profits and ‘sell' Axis-Shield. Those investors who bought into the company on our initial recommendation in December 2010 will now be sat on profits of almost 90%.

"The trading update yesterday reported no concerns and showed profits this year have increased by more than 20%. We believe emerging markets will be a key player in 2011 and we expect sales to come through from this region later in the year. Despite its strengths we have downgraded Axis-Shield as we feel the current profits available should be taken by shorter term investors."