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Our monthly Ice Best Buys Now are designed to highlight our team’s three favourite, most timely Buys from our growing list of income-focused Ice recommendations, to help Fools build out their portfolios.
“Best Buys Now” Pick #1:
A G Barr (LSE: BAG)
- Part-family-owned soft drinks business that has an attractive brands portfolio, which includes Irn-Bru.
- Sales for its first half year are expected to be up 5% to c.£221, as it benefits from strong soft drinks growth. The star performer was Rubicon, which delivered double-digit growth following successful marketing and distribution gains.
- The company reckons investment in its supply chain should provide enhanced margins, with volumes at recently acquired brands going through its existing facilities, resulting in cost savings. The integration of Boost is expected to be completed in the second half, which will contribute to £5m of costs as part of the business change programme, though in the longer term this should provide greater profitability on a reduced cost base.
- Long-time CEO Roger White was replaced by former Saga and Superdry boss Euan Sutherland in May. While this handover potentially introduces some risk, the company is operating from a position of strength, and should end the year with c.£60m cash on the balance sheet.
- It’s currently trading at just under 17x forecast earnings, a discount to the three-year average of closer to 19x. The prospective yield is 2.6%.
“Best Buys Now” Pick #2:
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