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With a Cash Reserve Much Better than Expected, Health Provider Cambian Is... Healthy

By Malcolm Stacey | Thursday 22 February 2018

Disclosure: I own shares in one or more of the stocks mentioned. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.

Hello, Share Swipers. It’s possible to gain the impression from other writers on this scrumptious website that most firms are doing rather badly. But this is far from the case.

Take Cambian (CMBN). Its latest trading update for the whole of 2017, boasted that business equated to its expectations. But better than that, net cash was £82 million - which is better than it’d thought. And as private share-shifters, a healthy and growing cash pile is good news. Not least because it provides a cushion against any future set-backs, which all companies are prone to from time to time.

A growing cash pile is also perhaps the best indication you can have of a company whose share price should continue to rise strongly. Yet Cambian Group is a firm you might expect to be at the mercy of Britain’s inadequate health resources. It provides specialist education services for children, including ways of resolving their behaviour problems.

Cambian looks after 2,100 kids and employs over 4,300 people across a portfolio of 224 residential facilities, specialist schools and fostering offices located in England and Wales. As you can see, these children require the help of many people and vast resources and Cambian fills that need. It provides residential homes for them and sorts out foster care. So really we have another outsourcing company, though one that is going in the opposite direction to some of those beleaguered construction ventures.

Like me, you probably love special dividends. Because of this outfit’s 2017 success, it has promised a special divi of 8.2p a share. That's a total of £15 million. And only last September, it returned another £50 million to shareholders. And this is one of those well-run companies which gives investors a warm feeling that you are really helping unfortunate children with mental health and other distressing conditions.

Now please join me in the Punter’s Return.

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