Companies: CHNS    EBTM    HTT   

Taking up the retail reins following the sad passing of his mentor, Richard Ratner, analyst Andy Wade has issued a buy recommendation on internet fashion retailer EBTM despite wider-than-expected annual losses to April from the AIM-listed company.

Wade sees recent acquisitions Atticus and Lowlife contributing £1.8 million to forecast first profits this year and with the shares trading on a price to earnings (p/e) ratio of less than ten this year, falling to below seven times for 2009, the stock ‘looks to be at a good price for a fast-growing internet-based operation’.

Wade in the water with Hot Tuna
Regarding surf-wear brand Hot Tuna, Wade doubts whether many investors would ‘find much to get excited about’ following results for the year to June. But in his view, ‘prospects changed dramatically’ with the appointment of Niels Juul as chief executive in early June.

A strategic review has identified a plan of action and renewed marketing efforts are gaining traction for the brand, although forecast sales have been halved to £4.5 million and investors shouldn’t expect it to break even until 2009. ‘Although it is very difficult to set any kind of target price, we believe the business is worth considerably more than the current [£6.2 million] market value… Buy,’ writes Wade.

Back-up power supplier China Shoto is another share to buy, according to analyst Alan Matthews, after it ‘opened up the Indian market’ through a US$10 million (£4.9 million) contract with a large telecoms operator there. He sees the group’s first deal outside its domestic market as ‘significant’ and making current forecasts look ‘increasingly conservative’. These put the shares on a p/e ratio of six, leaving the stock ‘significantly undervalued’.