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Clarkson Floats Into Higher Waters and the Share Price Could Rise with the Happier Tide

By Malcolm Stacey | Wednesday 15 August 2018

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. 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 Cuddlers. August is a dead month for the kind of stock market news which causes a share to soar or crash. On the whole, values slowly decay. Not necessarily because companies are in trouble, but because volumes are low. And they're slow not for any interesting reason, but for the prosaic fact that many of the big traders have swapped their screens for a bucket and spade to keep their holidaying kids happy.

Consequently, my fellow analysts and I find it hard in August to find shares which are likely to make you rich in a few golden months. The best we can hope for is a company that is at early stages of growth or is in a recovery stage after a bit of a setback. In the latter column is Clarkson (CKN). This is not the erstwhile presenter of Top Gear, but a company with the Nelson touch.

Clarkson is an outfit that in the last century might have featured in a book by Joseph Conrad called Lord Jim. It does all kinds of vital services to keep going the transportation of goods by sea. Rather romantic, ain't it?

But the business is vital to the economies of Blighty and the world. It does the broking between the cargo owners and the ships. It also has a banking service, including the supply of finance, for maritime purposes. And it provides port facilities. In fact, it seems to have tentacles all over the corporate marine sector.

This can be a difficult area. And Clarkson was moved to issue a profit warning in the Spring. This naturally caused a topple in the share price. And the situation was confirmed when results were announced for the first bit of 2018. Pre-tax profit fell to £18 million from £21.9 million, though that doesn’t seem too drastic.

And the well-respected company now sees signs of a recovery in the shipping game. And I've no reason to doubt this, if only because commodity prices seem to be strengthening. The current share price is 2680p. But the year high is 3475p and I suppose it could climb into that vicinity again.

Meanwhile is the Punter's Return in your vicinity?

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