Commonwealth Games could shine investor spotlight on U.K. industrials

By Steve Goldstein

The upcoming Commonwealth Games have the opportunity to focus investor minds on the U.K.’s “Mittelstand” in the Greater Birmingham region, an analyst says.

Mittelstand is the German word for small- to medium-sized enterprises. The Commonwealth Games, a mini Olympics for former members of the British Empire, are due to be held in Birmingham starting July 28.

“The heart of the Midlands was the birthplace of the industrial revolution which began in the 18th century. Birmingham is a major city in the West Midlands and is still home to the UK automotive industry and a profusion of SMEs,” said strategists at Jefferies led by Sean Darby.

U.K. SME stocks appear to have a decent return on equity and value, they said. They screened for industrials offering both value and quality, coming up with a list including Mitie Group /zigman2/quotes/201200333/delayed UK:MTO -0.70% , Pagegroup /zigman2/quotes/203982351/delayed UK:PAGE -0.27% , SThree /zigman2/quotes/205752173/delayed UK:STEM -0.73% , Avon Protection /zigman2/quotes/209664543/delayed UK:AVON +0.62% and Morgan Advanced Materials /zigman2/quotes/208158435/delayed UK:MGAM 0.00% .

“We continue to like the UK banks whose dividend yield is half the multiple of the PE – a value investor’s dream whilst trading on fair PEG ratios,” they added. That description, on Jefferies numbers, can be applied to Bank of Georgia /zigman2/quotes/206519596/delayed UK:BGEO -0.86% , Barclays /zigman2/quotes/208409333/delayed UK:BARC +0.47% , Lloyds Banking Group /zigman2/quotes/202285510/delayed UK:LLOY -0.12% , OSB Group /zigman2/quotes/201874630/delayed UK:OSB -0.53% , TBC Bank /zigman2/quotes/203300407/delayed UK:TBCG -0.53% and Virgin Money UK /zigman2/quotes/207233909/delayed UK:VMUK -1.25% .

The FTSE 100 /zigman2/quotes/210598409/delayed UK:UKX +0.56% edged up 0.1% in afternoon trade, with investors hesitant ahead of the Fed minutes, due after the London Stock Exchange close. Supermarket delivery firm Ocado /zigman2/quotes/207225647/delayed UK:OCDO +1.25% rose 4% to lead the U.K. benchmark, while movie-chain operator Cineworld surged 20% to be the top performing FTSE 250 stock.

/zigman2/quotes/201200333/delayed

Add to watchlist UK:MTO

Mitie Group PLC

UK : U.K.: London

99.70 p

-0.70 -0.70%

Volume: 824,601

Nov. 30, 2023 11:07a

P/E Ratio

14.58

Dividend Yield

3.21%

Market Cap

£1.35 billion

Rev. per Employee

£64,587

/zigman2/quotes/203982351/delayed

Add to watchlist UK:PAGE

PageGroup PLC

UK : U.K.: London

450.20 p

-1.20 -0.27%

Volume: 11,451

Nov. 30, 2023 11:06a

P/E Ratio

14.26

Dividend Yield

7.05%

Market Cap

£1.42 billion

Rev. per Employee

£226,931

/zigman2/quotes/205752173/delayed

Add to watchlist UK:STEM

SThree PLC

UK : U.K.: London

409.50 p

-3.00 -0.73%

Volume: 24,755

Nov. 30, 2023 10:36a

P/E Ratio

11.09

Dividend Yield

3.91%

Market Cap

£551.76 million

Rev. per Employee

£542,438

/zigman2/quotes/209664543/delayed

Add to watchlist UK:AVON

Avon Protection PLC

UK : U.K.: London

£ 807.00

+5.00 +0.62%

Volume: 30,118

Nov. 30, 2023 11:03a

P/E Ratio

N/A

Dividend Yield

0.03%

Market Cap

£242.08 million

Rev. per Employee

N/A

/zigman2/quotes/208158435/delayed

Add to watchlist UK:MGAM

Morgan Advanced Materials PLC

UK : U.K.: London

258.50 p

0.00 0.00%

Volume: 16,781

Nov. 30, 2023 10:29a

P/E Ratio

12.39

Dividend Yield

4.64%

Market Cap

£732.66 million

Rev. per Employee

£132,842

/zigman2/quotes/206519596/delayed

Add to watchlist UK:BGEO

Bank of Georgia Group PLC

UK : U.K.: London

3,465.00 p

-30.00 -0.86%

Volume: 3,576

Nov. 30, 2023 11:08a

P/E Ratio

3.03

Dividend Yield

7.73%

Market Cap

£1.57 billion

Rev. per Employee

£155,666

/zigman2/quotes/208409333/delayed

Add to watchlist UK:BARC

Barclays PLC

UK : U.K.: London

140.96 p

+0.66 +0.47%

Volume: 5.24M

Nov. 30, 2023 11:15a

P/E Ratio

N/A

Dividend Yield

5.46%

Market Cap

£21.10 billion

Rev. per Employee

£292,803

/zigman2/quotes/202285510/delayed

Add to watchlist UK:LLOY

Lloyds Banking Group PLC

UK : U.K.: London

43.40 p

-0.05 -0.12%

Volume: 20.98M

Nov. 30, 2023 11:15a

P/E Ratio

N/A

Dividend Yield

5.81%

Market Cap

£26.83 billion

Rev. per Employee

£411,295

/zigman2/quotes/201874630/delayed

Add to watchlist UK:OSB

OSB Group PLC

UK : U.K.: London

£ 375.00

-2.00 -0.53%

Volume: 39,004

Nov. 30, 2023 11:14a

P/E Ratio

6.55

Dividend Yield

0.09%

Market Cap

£1.44 billion

Rev. per Employee

N/A

/zigman2/quotes/203300407/delayed

Add to watchlist UK:TBCG

TBC Bank Group PLC

UK : U.K.: London

2,790.00 p

-15.00 -0.53%

Volume: 16,805

Nov. 30, 2023 11:11a

P/E Ratio

4.76

Dividend Yield

6.12%

Market Cap

£1.56 billion

Rev. per Employee

N/A

/zigman2/quotes/207233909/delayed

Add to watchlist UK:VMUK

Virgin Money UK PLC

UK : U.K.: London

£ 142.75

-1.80 -1.25%

Volume: 531,763

Nov. 30, 2023 11:15a

P/E Ratio

10.26

Dividend Yield

0.04%

Market Cap

£1.92 billion

Rev. per Employee

£502,672

/zigman2/quotes/210598409/delayed

Add to watchlist UK:UKX

FTSE 100 Index

UK : FTSE UK

7,465.24

+41.78 +0.56%

Volume: 94,210

Nov. 30, 2023 11:15a

/zigman2/quotes/207225647/delayed

Add to watchlist UK:OCDO

Ocado Group PLC

UK : U.K.: London

601.00 p

+7.40 +1.25%

Volume: 265,366

Nov. 30, 2023 11:15a

P/E Ratio

N/A

Dividend Yield

N/A

Market Cap

£4.64 billion

Rev. per Employee

£132,805