Daily Mail share tips: Greggs and Photo-Me
Twice a week the Daily Mail's shares experts take a quick look at two stocks of note ...
Greggs
VITAL STATISTICS (trading update)
Like-for-like sales in six weeks to December 9: +2%
One-year share performance: -8%
The Atkins' fad may have been short-lived but with consumers becoming more health conscious it is no surprise that sausage roll and pasty seller Greggs had a difficult year. Stiff competition, higher costs and the warm autumn have also conspired to make life tough.
The group is fighting back with Greggs' healthier options range, including wraps, rolls and sandwiches with less than 400 calories.
The company has also created the new position of retail director to be the 'national champion of the Greggs brand'.
And it is closing two of its Baker's Oven divisions in Scotland and the north of England, rebranding them as Greggs.
The group's stock market rating is broadly in line with its sector and with further share buybacks likely to be on the menu investors who believe there will always be an appetite for the traditional sausage roll should have a nibble.
VERDICT: Add
Photo-Me
VITAL STATISTICS (half year)
Pre-tax profits: £12m -43%
Dividend: 1p flat
One-year share performance: -26%
The photo booths operator Photo-Me has blamed 'teething problems' at its manufacturing plant in Singapore for a slump in earnings.
After a profit warning in January and the collapse of takeover talks in November, this latest update will disappoint investors.
As well as the trademark boxes in train stations, Photo-Me makes machines used by the likes of Tesco and Boots to process pictures.
It is this division which has struggled as delays in the production of the so called mini-labs meant it couldn't sell as many as planned.
Management is confident these problems have been resolved and there is potential for growth as it continues to expand overseas.
It has also promised to return £100m to shareholders by taking on a bank loan.
Plans to sell off parts of the firm could generate further cash. But investors should be wary. The photographic printing industry is still struggling to comes to terms with the digital revolution as people opt to keep their snaps on their computers.
Verdict: Avoid
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