Making a comeback

As a result, Weir’s profits collapsed. The company earned £334m in 2013 and £73m in 2014. By 2015, it was making a loss, to the tune of £179m for 2015.

Earnings started to recover in 2016, but it’s taken three years for Weir to get back to where it was in 2013. For 2019, the City is expecting the firm to report net income of £233m, or earnings per share of 94p. Based on these figures, the stock is trading at a forward P/E of 15.8.

Further growth is predicted for 2020 as demand continues to improve. Analysts have pencilled in growth of 19% for the year, taking earnings to 112p per share. I’m confident Weir can hit this lofty growth target. After years of cutting back, it now looks as if the mining industry is starting to spend again, which is good news for the company.

Spending money

Indeed, today the group announced it had received its largest ever single order ($100m) from one company to provide industry-leading, energy-saving solutions to the Iron Bridge Magnetite Project in Australia. If this trend continues, I think there’s a good chance Weir could outperform City expectations for 2020.

With the stock currently trading at a forward P/E of 13 (for 2020) in line with the sector average, there’s a good chance its shares could jump higher if it beats the City. A yield of 3.2% sweetens the appeal, in my view.

Niche business

Another FTSE 250 growth stock I think would be a great addition to any portfolio is Equiniti (LSE: EQN). You might not have heard of this business, but there’s a good chance you’ve made use of its services.

Equiniti provides complex administration and payment services for the financial services industry. It takes on the jobs other companies don’t want, such as pension administration, share registration, and international payments to corporate clients. These are hardly exciting businesses, but they’re essential, and Equiniti has carved out a highly profitable niche for itself here.

Following a significant acquisition in the US, Equiniti’s revenue has jumped from £382m in 2016 to £530m for 2018. It’s projected to hit £560m in 2019, according to City analysts. Thanks to deal synergies, net income will more than triple in 2019, from £18m last year to £72m for 2019.

Based on these forecasts, the stock is currently dealing at a forward P/E of just 11. That’s just too cheap, in my opinion, for such a high-quality, niche business that’s set to triple net income for 2019. As well as the discount valuation, shares in the administration giant also support a dividend yield of 2.8%.

The post £2,000 to invest? Here are 2 FTSE 250 growth stocks I’d buy right now appeared first on The Twelfth Magpie.

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• How much do you need in a Stocks and Shares ISA to aim for £375 a week in retirement?

Rupert Hargreaves owns no share mentioned. The Motley Fool UK owns shares of Equiniti. The Motley Fool UK has recommended Weir. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Bouncing back

Engineer Weir (LSE: WEIR) was demoted from the FTSE 100 to the FTSE 250 in 2015 after its shares slumped heavily over a period of 18 months. This was because its biggest businesses serve the mining and oil & gas sectors, where activity was badly hit by the collapse in commodity prices during the period.

However, the subsequent recovery in prices means the future for Weir is now a lot brighter. A trading update and announcement of a major acquisition in April confirmed that the company is bouncing back strongly. Indeed, with its shares trading at around 2,000p and its market cap at over £5bn, continued progress could see it return to the FTSE 100 this year.

The City consensus forecast is for Weir to deliver EPS of 115.9p for the year, giving a price-to-earnings (P/E) ratio of 17.3. This is relatively high compared with the FTSE 100 long-term historical average of 14, but that 34% EPS growth I mentioned earlier puts the valuation in a far more attractive light. The price-to-earnings growth (PEG) ratio is 0.5, which is well to the ‘good value’ side of the PEG ‘fair value’ marker of 1.

Due to the brighter prospects for the business and the low PEG valuation, I rate the stock a ‘buy’, noting also that the dividend — pegged by the board at 44p for the last four years — is forecast to increase to 46.6p this year, giving a handy yield of 2.6%.

Good momentum

Agriculture and engineering group Carr’s (LSE: CARR) today reported a “strong performance” for the 17 weeks to 30 June, with both divisions “trading slightly ahead of expectations.” Surprisingly, the shares fell over 6% to 154.5p when the market opened this morning. I put this down to profit taking, as the shares had a strong run-up to a high of 165p ahead of today’s update. This can happen with smaller companies and Carr’s is a FTSE SmallCap firm with a market value of £141m.

Despite its small size, relative to a giant like Weir, Carr’s has customers in 50 countries around the world. Its agriculture division manufactures and supplies feed blocks for livestock, farm machinery, and runs a UK network of rural stores. Its engineering division specialises in bespoke equipment (notably robotic and remote handling equipment) for sectors including nuclear, petrochemical and pharmaceutical.

After today’s slight upgrade to expectations for the current financial year (which ends 31 August), I reckon we’re looking at EPS of getting on for 13p, compared with 12.5p when I last looked at the company. This gives a P/E of 12 and when combined with the aforementioned 38% EPS growth, the PEG ratio is an eye-catching 0.3. With good momentum across the business, and a prospective dividend yield of 2.8% also on the cards, this is another stock I rate a ‘buy’.

The post One secret small-cap I’d buy alongside this FTSE 250 growth Goliath appeared first on The Twelfth Magpie.

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• Up 95%! This FTSE 100 stock’s outperformed Nvidia over the past year
• With a 9.3% yield, is this an amazing opportunity to consider buying dirt-cheap Taylor Wimpey shares?
• How much do you need in a Stocks and Shares ISA to aim for £375 a week in retirement?

G A Chester has no position in any of the shares mentioned. The Motley Fool UK has recommended Weir. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

With that in mind, here are two industrial engineering stocks that could prove to be worthy buys within an ISA for the long term.

Strong performance

Reporting on Tuesday was rock drilling tools specialist Mincon (LSE: MCON). The company’s 2017 financial year was relatively impressive, with total revenue increasing by 28% versus the prior year. This enabled gross profit to move 24% higher, with net profit up 13% versus the prior year. The company was able to overcome cost pressure to protect its gross margin. And while it has absorbed some higher costs thus far, it expects to see upward price movements for its product range during 2018.

Looking ahead, the company appears to have a solid growth outlook. Its bottom line is due to rise by 45% in the current year. This puts it on a price-to-earnings growth (PEG) ratio of 0.4, which suggests that it could offer growth at a reasonable price.

Furthermore, Mincon also announced the acquisition of Driconeq alongside its update. It is a leading supplier of high quality drill pipes and is being acquired for a total sum of €8m. It has the potential to positively catalyse the company’s future earnings growth rate.

While there may be some challenges ahead in terms of being able to successfully pass higher input costs onto customers, Mincon seems to have a sound underlying business which could deliver improving performance in the long run. As such, it could be worth buying now for the long term.

Turnaround potential

Also offering upside potential within the industrial engineering sector is pump maker Weir Group (LSE: WEIR). The company had experienced a hugely difficult period, with its bottom line coming under severe pressure in prior years. However, it was able to deliver a return to positive earnings growth in the last financial year.

This is set to become a trend, with further growth anticipated in each of the next two financial years. In fact, Weir Group is expected to report a rise in its bottom line of 40% this year, followed by growth of 15% next year. This has the potential to cause investor sentiment to improve – especially since the company trades on a PEG ratio of just 0.9.

Certainly, the stock is not yet fully recovered from the difficulties it experienced in previous periods, and it will take time for investor sentiment to improve. But with such a low valuation and positive forecasts, it appears to offer significant investment appeal for the long term.

The post Two growth stocks I’d buy and hold in my ISA appeared first on The Twelfth Magpie.

More reading

• With a yield of 6.8% and a P/E ratio of 12.1, is this a dirt cheap FTSE 250 stock to consider?
• Will SpaceX, Nvidia, or Alphabet be the first $10trn stock?
• Up 95%! This FTSE 100 stock’s outperformed Nvidia over the past year
• With a 9.3% yield, is this an amazing opportunity to consider buying dirt-cheap Taylor Wimpey shares?
• How much do you need in a Stocks and Shares ISA to aim for £375 a week in retirement?

Peter Stephens has no position in any of the shares mentioned. The Motley Fool UK has recommended Weir. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Finding shares which offer growth at a reasonable price has become more challenging this year. The FTSE 100 has risen in recent months, and this has led to a number of shares having higher valuations. For investors seeking to buy shares, this means there may be narrower margins of safety on offer.

Of course, while this is generally the case, there are exceptions. Here are two stocks which could offer high growth at a low price and, as such, may be worth buying today.

Improving guidance

Reporting on Monday was engineering specialist Weir Group (LSE: WEIR). The company stated in its trading update that performance in recent weeks in its upstream North American markets has been better than expected. This has led to higher volumes, stronger operating leverage and modest pricing recovery. The end result could be higher than expected profitability for the full year – assuming recent trends continue into the latter part of the year.

Clearly, this is excellent news for the company. It shows that while its end markets remain relatively fragile, they can offer growth potential over the long run. Investor sentiment has been improved by the news, with the company’s share price rising by almost 10% during the day of release.

Looking ahead, Weir Group is forecast to report a 44% rise in earnings this year. It is expected to follow this with growth of 28% next year. Despite this, it trades on a price-to-earnings growth (PEG) ratio of just 0.5, which suggests it could offer capital growth potential. Therefore, while its outlook may be uncertain and its forecasts could realistically be downgraded, it may offer significant upside potential.

Turnaround prospects

Although it may seem as though the world economy is performing well, there are industries and companies which are struggling. One example is power and rental solutions business Aggreko (LSE: AGK). It has reported four consecutive years of falling profitability, with a further decline in its bottom line forecast for the current year. This could hurt investor sentiment and send its share price lower in the short run.

However, there may also be a buying opportunity at the present time. Aggreko is expected to return to growth in the next financial year, with its earnings forecast to rise by 12%. This puts its shares on a PEG ratio of just 1.2, which suggests that now could be the right time to buy it for the long run.

Aggreko could also become a relatively enticing income play. It may only yield 3.2% at the present time, but its dividend is covered 2.1 times by profit. This suggests shareholder payouts could rise at a faster pace than profit over the medium term – without leaving the business in a more challenging financial position. Therefore, with a mix of growth, income and value potential, it could be a strong performer over the long run.

The post 2 discount growth stocks I’d buy right now appeared first on The Twelfth Magpie.

More reading

• With a yield of 6.8% and a P/E ratio of 12.1, is this a dirt cheap FTSE 250 stock to consider?
• Will SpaceX, Nvidia, or Alphabet be the first $10trn stock?
• Up 95%! This FTSE 100 stock’s outperformed Nvidia over the past year
• With a 9.3% yield, is this an amazing opportunity to consider buying dirt-cheap Taylor Wimpey shares?
• How much do you need in a Stocks and Shares ISA to aim for £375 a week in retirement?

Peter Stephens has no position in any shares mentioned. The Motley Fool UK has recommended Weir. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Source: Castellian Capital, FCA                       

For construction giant Carillion, traders’ negativity comes from several years of tepid revenue growth and stagnant earnings even as the company switches to supposedly higher margin services contracts. Net debt may be falling but until Carillion has improved margins and earnings I won’t be going long on the cyclical builder.

Grocer WM Morrison (LSE: MRW) shares have been a favourite short position for years as continued price wars have decimated profits for all major grocers. While the company’s turnaround is bearing fruit, falling market share and collapsing margins leave little room for shares to return to previous highs.

There’s a similar explanation for the struggles of online grocer Ocado (LSE: OCDO). Although sales continue to grow at a rapid clip the company has little pricing power and the entry of Amazon Fresh into the already crowded UK market doesn’t portend well for this relative minnow.

Take the problems of oil majors across the world then add in a 62% gearing ratio and the unpopularity of Tullow (LSE: TLW) is understandable. But with underlying operating costs per barrel of only $13.40, capital expenditure falling and production increasing significantly, the negativity around Tullow may be overblown.

Shake-ups in the gambling industry have investors betting heavily against the ability of Ladbrokes to adapt to lower footfall in high street shops, increased regulation of betting machines and a shift to online gambling.

Manufacturing pumps for oil producers and miners has made for a rough few years at Scottish engineer Weir. There are early signs of a recovery in capital expenditure in both industries but with 2016 expected to mark the fourth straight year of falling earnings, I won’t be taking the plunge on Weir just yet.

Brexit has been key to investor concern over the prospects for outsourcer Mitie (LSE: MTO), which blamed uncertainty over the referendum results for a profit warning in September. With businesses and government agencies evidently holding off on contracts until the dust settles I wouldn’t be betting on Mitie shares rocketing anytime soon.

Like Morrisons and Ocado, shrinking market share and increased competition from budget chains have hammered investor confidence in J Sainsbury (LSE: SBRY). Spending £1.4bn for troubled business Argos will only dilute management’s focus on turning around the core business. I expect rough seas ahead.

Plastics producer Victrex has become a target for short sellers due to falling sales to the oil & gas industry and regulatory scrutiny of its medical implants in the US. Long term though, being the market leader in a growth industry alongside stunning margins makes me think Victrex could be worth a closer look.

Woes in the oil & gas industry have also dented confidence in generator provider Aggreko. A profit warning late last year didn’t help and investors remain worried that continued weakness in emerging markets could spell trouble as debt rises.

The post Are the 10 most shorted shares on the FTSE 350 in your portfolio? appeared first on The Twelfth Magpie.

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Ian Pierce has no position in any shares mentioned. The Motley Fool UK has recommended Mitie Group, Victrex, and Weir. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Look before you leap

The Bury-based retailer reported another record first half last month when it announced its interim results for the 26 weeks to 30 July. Revenue for the period was up an impressive 20% to £971m, with operating profit before exceptional items up 63% to £77.7m. The increase in pre-tax profits was equally impressive, as they surged ahead 73% to £77.4m, with gross margins reaching 48.1%, compared to 47.4% reported for the same period a year earlier.

JD’s financial year ends on 31 January 2017, and the City is expecting the FTSE 250 firm to report double-digit earnings growth to the tune of 26% for the full year, with a further 10% increase forecast for FY2018. However, after yet another strong rally last month, JD’s shares are looking ever-more-expensive, with the company’s price-to-earnings ratio rising to 19 times forward earnings. I believe a big market correction could be on the cards soon, and new investors should sit on the sidelines and wait for a more favourable entry point before jumping in to JD.

Weir waiting for the inevitable?

Another London-listed firm enjoying a good September was engineering business Weir Group (LSE: WEIR). Shares in the Scottish firm have more-than-doubled since the start of February this year, with the 11% surge last month just adding to the already impressive gains. Can this rally continue until the end of the year, or are we just waiting for gravity to pull the shares back to where they belong?

The Glasgow-based group announced on Monday that it had promoted John Heasley, managing director of its Flow Control Unit to Chief Financial Officer, after his predecessor Jon Stanton moved up to become the group’ s new chief executive. This follows the announcement in July that CEO Keith Cochrane was stepping down after the firm reported a significant drop in first-half profits. In the six months to 30 June, profit before tax fell 25% to £82m, with revenues declining 12% as a result of weaker oil prices.

Sadly, our friends in the City don’t expect a second half turnaround for Weir, as consensus estimates suggest a 16% decline in underlying profits for the whole of 2016, with revenues expected to nosedive to £1.83bn. After this year’s share price outperformance, Weir looks pretty expensive at 27 times forecast earnings for 2016, and could be heading for an ever-more-likely slump by the end of the year.

The post Last month’s soaring shares are set to slump! appeared first on The Twelfth Magpie.

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Bilaal Mohamed has no position in any shares mentioned. The Motley Fool UK has recommended Weir. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Reasons for the decline include a 9% fall in rental solutions sales, with weakness in North America being a key contributing factor. Aggreko’s other divisions also saw falling top lines, with power solutions struggling to compete with strong comparatives from the prior year and power solutions utility revenue being hurt by the ending of a contract in Panama.

With Aggreko currently yielding 2.5%, it appears to lack income appeal. Certainly, its dividends may be covered 2.4 times by profit and its bottom line is forecast to rise by 7% next year. But with a price-to-earnings (P/E) ratio of 16.5, it appears to be fully valued.

Bright prospects

Also reporting today was Weir Group (LSE: WEIR), with the pump maker’s shares rising by around 8% following the release of impressive first quarter results. Due to cost reductions and a resilient minerals performance, Weir’s trading has been ahead of expectations, although guidance for the full-year has not been upgraded.

Clearly, Weir is enduring a challenging period as the oil and gas industry adapts to a lower oil price. For example, Weir’s like-for-like (LFL) order input in the first quarter was down by 22% versus the same period of the previous year and while £10m in cost savings and a disposal programme are aiding its financial performance, Weir is still forecast to report a fall in earnings of 28% in the current year.

Although dividends are set to be covered 1.5 times by profit this year, Weir’s shareholder payouts are set to fall marginally in 2017. And with the company yielding 3.4%, it doesn’t appear to be a particularly enticing income play, although with its shares having a price-to-earnings-growth (PEG) ratio of 1.4, their capital gain prospects are relatively bright.

Value for money

In terms of appealing income stocks, BAE (LSE: BA) takes some beating. That’s because its yield of 4.5% is higher than that of the wider index and with dividends being covered 1.8 times by profit, there’s scope for significant increases in shareholder payouts over the medium term. The prospect of this is much greater due to the improving outlook for the global defence sector, with the US economy moving from strength to strength and likely to deliver an increase in defence spending in the coming years.

With BAE trading on a PEG ratio of 1.8, it appears to offer good value for money given its excellent track record and wide economic moat. As such, it seems to be a far more appealing purchase than Weir or Aggreko – especially for income-seeking investors.

The post Do today’s results make Aggreko plc and Weir Group plc better income stocks than BAE Systems plc? appeared first on The Twelfth Magpie.

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Peter Stephens owns shares of BAE Systems. The Motley Fool UK has recommended Weir. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

The oil industry is facing an unprecedented period of change and fall in spending by oil majors, some of which are Hunting, Amec and Weir’s largest customers. 

The bargain bucket 

Contrarian investing, buying when the rest of the market is selling, can be an extremely lucrative strategy, but it’s also risky and not for the faint of heart. 

Nonetheless, Hunting, Amec and Weir have become three top contrarian investments over the past 12 months. Indeed, since mid-November last year, Hunting, Amec and Weir have underperformed the FTSE 100 by 45%, 50% and 40% respectively, excluding dividends. 

However, the big question is, will these companies ever recover? Are Hunting, Amec and Weir misunderstood bargains, or falling knives that should be avoided? 

Bargains or knives? 

Weir and Hunting are just two of the many casualties of the US shale bubble, which has been slowly deflating for the past year as oil prices plunge to new depths. 

Both companies supply equipment for the onshore oil and gas industry and had been increasing capacity to keep up with demand from the sector in the US. But now demand has slumped, and these two engineers have been forced to undertake drastic cost-cutting measures to realign operations to the lower level of demand. 

After reporting record results last year, both Hunting and Weir are set to report dramatic declines in earnings this year. Specifically, Hunting’s earnings per share are set to fall 88% year-on-year while Weir is set to report a 43% decline. 

Still, City analysts are expecting a slight recovery in earnings next year. Analysts have pencilled in 2016 earnings per share growth of 40% for Hunting and 2% for Weir. Although, even though the two companies are set to return to growth during 2016, they look relatively expensive at current levels. 

For example, Weir currently trades at a forward P/E of 13.3 and a 2016 P/E of 13.5, while Hunting currently trades at a forward P/E of 57.3 and a 2016 P/E of 36.2. 

These valuations don’t leave much room for disappointment and could signal further volatility ahead. 

Worth the risk? 

Overall, based on their current valuations, it could be wise to avoid Weir and Hunting for the time being but Amec looks more reasonably priced. 

Even after warning on profits at the beginning of the month, Amec is still on track to report a pre-tax profit of £215m this year. On a per-share basis, the company is set to report earnings per share of 60.9p for 2015, which implies that the shares are trading at a lowly forward P/E of 7.5.

The post Are Hunting plc, Amec Foster Wheeler PLC & Weir Group PLC Misunderstood Bargains? appeared first on The Twelfth Magpie.

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• Will SpaceX, Nvidia, or Alphabet be the first $10trn stock?
• Up 95%! This FTSE 100 stock’s outperformed Nvidia over the past year
• With a 9.3% yield, is this an amazing opportunity to consider buying dirt-cheap Taylor Wimpey shares?
• How much do you need in a Stocks and Shares ISA to aim for £375 a week in retirement?

Rupert Hargreaves has no position in any shares mentioned. The Motley Fool UK has recommended Weir. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Copper-bottomed qualms

Shares in Antofagasta (LSE: ANTO) have been swept higher in recent days as value hunters have piled into the mining and energy sectors. The copper digger itself ascended 11% last week alone, but I believe this represents nothing more than a flash in the pan — the copper market remains in a state of chronic imbalance, and Bank of America commented just today that “miners have not reacted fast enough to the challenging macro-economic backdrop.”

Indeed, the broker estimates that a further 500,000 tonnes worth of copper needs to be removed from the market in order to stop the metal price plunging — copper slumped back below $5,000 per tonne again last month. Not surprisingly the City expects Antofagasta to swallow a 48% earnings slide in 2015, a third consecutive dip if realised that would leave the miner on a ridiculously-high P/E ratio of 36.5. Given the firm’s muddy earnings picture I find this massive premium difficult to justify.

All that glistens is not gold

It could be argued that silver and gold producer Fresnillo (LSE: FRES) is in better shape than many of the world’s mining plays. Traditionally, precious metals have been popular safe-havens in times of macroeconomic and geopolitical uncertainty, making the diggers less susceptible to the cyclical problems washing over the rest of the sector. And a 13% share price bump at Fresnillo between Monday and Friday, transpiring as Russian military action in Syria intensified, lends support to such a theory.

However, the role of gold as an island of calm in choppy waters has seemingly evaporated over the past couple of years, not helped by a low inflationary environment and subdued Asian demand. And silver — by far Fresnillo’s biggest market — is being whacked by falling industrial demand, not to mention reduced investment activity. I reckon the Mexican operator is likely to come under fresh pressure once buoyant market enthusiasm dissipates.

Investor returns set to motor higher

Diversified engineering giant GKN (LSE: GKN) has endured a torrid time over the past year as fears over falling Chinese car demand — combined with concerns over slowing aircraft orders — has weighed on investor appetite. The Volkswagen emissions scandal also took a chunk out of the firm’s share price when news broke last month, causing the Redditch business to slump to its cheapest for two-and-a-half years.

However, the market has viewed this is a prime buying opportunity and GKN rose 5% alone last week. The possibility of further share price weakness cannot be ruled out as accusations of mass test-rigging across the car industry are likely to continue for some time yet. But for more patient investors I reckon increasing plane and auto sales across the globe should deliver rich rewards. GKN currently deals on a prospective P/E rating of just 11.1, a level which I believe provides an excellent entry point.

Pumps play under pressure

I am not so optimistic about the profits picture over at industrial pump manufacturer Weir Group (LSE: WEIR), however. The stock ascended 7% during Monday-Friday, but I reckon this represents just a short-term gain as the prospect of further price weakness across the oil and metals segments — and consequent impact on operating and capex budgets — hammers demand for Weir’s hi-tech goods.

The Scottish business saw revenues topple 13% during January-June, to £1bn, while an 18% drop in total orders suggests that things aren’t about to improve any time soon. Weir hiked R&D spend by almost 40% in the period to help its earnings outlook, but I believe the firm carries too much risk at the current time as its key end markets struggle. Weir is expected to endure a 41% bottom-line slide in 2015 — resulting in a P/E ratio of 16.9 times — and I reckon further pain should be anticipated.

The post Can Antofagasta plc, Fresnillo Plc, GKN plc And Weir Group PLC Extend Last Week’s Gains? appeared first on The Twelfth Magpie.

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Royston Wild owns shares of GKN. The Motley Fool UK owns shares of GKN and has recommended Weir. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Standard Chartered

Thanks to escalating emerging-market fears, shares in banking goliath Standard Chartered (LSE: STAN) have dropped 20% during the past four weeks. But heavy price weakness is nothing new, with the bank’s failure to resuscitate its ailing fortunes in Asia having smashed investor sentiment in recent years. Indeed, Standard Chartered saw pre-tax profit tank a further 44% during January-June, to $1.8bn thanks to further impairments.

Plenty of uncertainty continues to swirl around the firm, even if the installation of Bill Winters as chief executive provides Standard Chartered with a fresh approach. From concerns over rising regulatory bills, through to the strength of the balance sheet — a situation that many expect to be resolved with the raising of new equity — investors still have plenty to digest, and I believe stock selectors should adopt a ‘wait and see’ approach before piling into the bank.

Weir Group

Matching the severe share price weakness of the mining and oil sectors, pump builder Weir (LSE: WEIR) has haemorrhaged much of its value over the past month — the firm is now dealing 17% lower than levels seen at the same point in August. This comes as no surprise as resources plays across the globe slash capital expenditure, a scenario that looks set to continue as profits struggle in light of tanking commodity prices.

Weir advised last month that revenues slumped 13% during the first half, to £1bn, and an 18% collapse in new orders suggests that the tough environment is here to stay for some time yet. Thanks to what the business describes as “the most severe downturn in oil and gas markets for nearly thirty years,” and despite a renewed focus on R&D, I do not expect the firm’s fortunes to improve any time soon as its end markets struggle.

Old Mutual

Unlike Standard Chartered and Weir, I reckon Old Mutual (LSE: OML) is a great pick for those hunting for bargains. The life insurance giant has seen its stock price erode 16% since the middle of August, the business having being caught up in the sell-off affecting many companies that are reliant on developing markets.

I believe that the market is missing a trick here, however, and that Old Mutual’s growing presence across Africa should deliver brilliant long-term gains. Indeed, the firm saw funds under management advance 5% in January-June, to £335.7bn, with profits from South Africa rising 14%, and those from the rest of the continent 31%, during the period. With wealth levels rising in the region and financial product penetration still relatively low, I am convinced Old Mutual has plenty left in the tank.

Prudential

Insurance experts Prudential (LSE: PRU) has suffered the same fate as Old Mutual more recently thanks to rising fears over South-East Asia, and the London firm has seen its share price sink 10% in the past four weeks. I reckon the market is overlooking the terrific growth prospects that the firm’s pan-global presence afford, however, a factor that helped power Prudential’s operating profit 17% higher in January-June to $1.9bn.

Prudential saw profits rise at double-digit rates across each of its main markets, and a 17% uptick in Asian profits — to £632m — underlines the abundant opportunities of this key growth region. And thanks to the steady emergence of a rising middle class, I believe Prudential is in a sweet spot as demand for protection and savings products canters steadily higher.

The post Is It Time To Pile Into Double-Digit Losers Standard Chartered PLC, Weir Group PLC, Old Mutual plc And Prudential plc? appeared first on The Twelfth Magpie.

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Royston Wild has no position in any shares mentioned. The Motley Fool UK has recommended Weir. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.