LONDON (ShareCast) - (Sharecast News) - It's always darkest just before the dawn, The Sunday Times's Sabah Meddings said of Greencore in her 'Inside the City' column.


The food producer's shares have started to recover after hitting bottom in October, towards the end of the first wave of Covid-19.

In what is anticipated will be a boon for the stock, schools are due to reopen on 8 March, although indoor eating at cafes or restaurants will not be possible until 17 May.

Its products are already stocked at grocers and the company has been increasing its trade with cafes.

Furthermore, unlike rival Gregg's, Greencore's valuation has yet to return to its pre-pandemic level, leaving its shares 'undervalued', according to analysts at ShoreCap, who believe the company is in the "darkest stage before a quick brightening of the commercial sky".

The firm has indeed seen dark times, with pre-tax profits down from £92.3m to £17.3m over the year ending on 25 September.

It was also forced to raise £90m via a share placing in November.

"The Dublin-based company tends to be tightly run and could be well placed to benefit from a summer recovery," Meddings said.

"Two years ago, this column warned investors to leave it on the shelf. Today, it is time to bite back in. Analysts agree: HSBC has a 170p target on the stock.

"This time, it's a buy."



The Financial Mail on Sunday's Midas column tipped shares of Tritax EuroBox to its readers, pointing out the company's good growth prospects.

Like Tritax BigBox, its bigger cousin, the firm runs distribution centres, but on the Continent and not the UK, including for retail giants such as Inditex in Barcelona, for Amazon in Rome and for Abbott Laboratories in the Netherlands.

While ecommerce is less developed on the Continent it's growing fast on the heels of the pandemic, Midas pointed out.

For the year to September, EuroBox said that profits had more than doubled, its portfolio had increased in value and rents were up by nearly 17%.

That led the firm to hike its dividend by nearly 14%, which was followed by the announcement of a £174m equity raise with applications for the latter open until 5 March.

Those monies will be funneled into the group's expansion plans in Germany and Italy and should lower the company's borrowing costs while creating more opportunities for expansion.

To take note of, said the tipster, EuroBox has the ability to acquire properties for its distribution centres more cheaply than rivals.

"Tritax EuroBox is a respected player in a fast-growing market.

"The share offer, at £1.03, looks attractive, particularly as the company is committed to long-term dividend growth."

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