H&T Group PLC (AIM:HAT), the pawnbroker, has made it into Shore Capital’s list of top income and growth stocks.
Using a screen for growth characteristics and a reasonable dividend yield, house stock H&T comes out with a fair value of 55p or 21% upside.
Pawnbroking is benefiting from increased demand owing to capacity withdrawal by alternative unsecured lenders as well as the increased cost of living.
The jewellery retailing business is part of the growing fashion for second-hand jewellery, as well as offering relatively attractive price points versus competitors, while the FX business is expanding into other ancillary services and aiding footfall into its stores.
Plans to increase the estate to more than 350 stores over the longer term versus 278 on 31 December 2023 underline the ambition, says ShoreCap.
The broker’s forecasts assume revenue growth of just 8% over the next three years while there is downside protection from the trailing net asset value of 403p, which is largely underpinned by gold jewellery.
Non-stocks highlighted by the screen were: ABF at 2719p, AJ Bell at 350p, Domino’s Pizza at 341p, GSK at 1810p, Kainos at 1044p, Knightsat 144p, Moneysupermarket.com (LSE:MONY) at 232p, Norcros at 214p, OSB Group at 1772p, Rathbones 1772p, Serco at 185p, Standard Chartered at 751p, Tritax Big Box REITat 158p and Whitbread at 3114p.