Primary Recommendation

JD Sports Fashion - Looks 50% undervalued compared to peers

August 2009

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

We think now is a good time to look at the sports retailing sector on the basis that the sector will be a beneficiary of next June's World Cup. But the quoted constituents are not obvious growth share investments and JJB, Sports Direct and Blacks Leisure have all shocked in the past year. JD Sports Fashion, the subject of this month's main recommendation, stands out, not because of a low prospective PE of 6x, which is based on its forecast pretax profit of Â£55m and eps of 78.5p but because it is debt free and has been piling up its cash.JD's three competitors might also be considered one and the same given that they operate in the mass market end of sportswear whereas JD has a differentiated offer; it sells clothing by sports bra ...

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Market Comment - August '09

West China Cement - Bigger rivalâ€™s IPO oversubscribed (Prospective PE of 13 versus 3.9 for WCC)

JD Sports Fashion - Forecast £100m higher than projected 18 months ago (February 2017)

JD Sports Fashion (January 2017)

JD Sports - Cash pile climbs from £100m to Â£232m (October 2016)

JD Sports - Sports fashion side sees +10% like-for-like sales for second year running (May 2016)

JD Sports Fashion - Another 10% upgrade to forecasts (February 2016)

JD Sports Fashion - Consistently good performer (January 2016)

JD Sports - Gain since tip: 578% (February 2014)

JD Sports Fashion (December 2012)

JD sports Fashion - Sells Canterbury sports brand for Â£22.7m (September 2012)

JD sports Fashion (August 2012)

JD Sports - Analysts see scope for eps rise to 150p next year (February 2012)

JD Sports (December 2011)

JD Sports (August 2011)

JD Sports (May 2011)

JD Sports - Mulling a bid for JJB Sports (February 2011)

JD Sports (December 2010)

JD Sports Fashion (July 2010)

JD Sports - +227% gain since original tip (May 2010)

JD Sports Fashion - Cash forecast to rise to Â£35m by year end (January 2010)

JD Sports (November 2009)

JD Sports - Up by 350p since Jan tip (October 2009)

JD Sports Fashion - Buys the iconic Canterbury rugby brand (September 2009)

JD Sports - Fashion retailer and brand owner on PE of 3.5 (January 2009)

With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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