All trading involves risk. Losses can exceed deposits.
Over 40 years’ heritage
Over 185,000 clients worldwide
Over 15,000 markets

Stock picks: Smart Metering Systems, Advanced Oncotherapy and Midwich Group

We talk to Alan Green from PIR Multichannel about three small-cap stocks he’s watching – Smart Metering Systems (SMS), Advanced Oncotherapy (AVO) and Midwich Group (MIDW).

All trading involves risk. Losses can exceed deposits.

Smart Metering Systems (SMS)

As a provider of smart utility-metering systems, SMS sits in an industry that many believe could be about to see major growth. And its share price chart certainly reflects that – rising over 134% from October 2015 to October 2017.

Not only that, but its fundamentals have been strong as well. Every time SMS has released results, its earnings, revenues, dividend, as well as its earnings before interest, tax, depreciation and amortization (EBITDA), have grown. In its last earnings announcement, the dividend was raised 27%.

With such strong growth, choosing the right time to buy SMS is key, so look at resistance levels on its 200-day moving average. From there, you could be looking at an upside of 10-15%.

At the time of interview, Alan does not have any stake or professional interest in Smart Metering Systems.

Advanced Oncotherapy (AVO)

Advanced Oncotherapy is developing a revolutionary proton beam therapy machine to treat cancerous tumours. Development is taking place at a subsidiary called Application of Detectors and Accelerators to Medicine (ADAM), which works out of the European Organisation for Nuclear Research (Conseil Européen pour la Recherche Nucléaire or CERN) and uses Large Hadron Collider technology in AVO’s proton therapy systems.

AVO expect to be treating superficial tumours by autumn 2018. They’re also building a treatment centre at Harley Street, which they expect to open in March 2019.

Its technology may be impressive, but AVO’s recent share price history has been problematic – the company dropped from 110p down to below 20p from October 2016 to July 2017. The reasons for this fall have been well publicised, with funding issues at the start of the year causing concern.

With a modest recovery above 30p, though, AVO’s troubles could be behind it. And as the company nears the delivery date for its machines, it might be set for a return to 2016 levels.

Alan holds AVO stock and represents them with PIR Multichannel.

Midwich Group (MIDW)

Alternative Invested Market-listed (AIM) and with a market cap of around £370 million, Midwich Group has had a stellar 2017, offering few pullbacks for potential buying opportunities. Its share price grew nearly 115% in the 12 months to October 2017, and like Smart Metering Systems it has recently increased its dividend – this time by 36%.

Unlike SMS and AVO, MIDW isn’t developing exciting new tech. Instead, it supplies audio-visual, video, film, broadcast and lighting equipment to around 10,000 clients worldwide. But it’s a mid-size company that could be going places, and given recent growth its share price could go above £6.00 by 2018.

Resistance could again provide an opportunity to buy Midwich Group – if it ever does pull back – and around 400p could be the right area.

Alan does not have any stake or professional interest in Midwich Group.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

Find articles by analysts

Education

  • Direct market access

    In this section we introduce our trading platform, and illustrate the ease with which you can trade CFDs on a wide range of markets. We also cover features such as stops and limits and explain how trading with leverage works.

  • Trading mistakes

    Psychology is a key element of financial trading, and how you perceive and react to your trading can have a major impact on your success. In this module we go through some elements of trading psychology and identify a few common mistakes to watch out for.

  • Shares explained

    Without shares there could be no stock markets, which are vital to every national economy. Find out how the shares trade enables companies to expand and develop, while providing sources of income to private investors and larger funds.