If you are considering investing in AIM shares through an ISA, these five analyst picks may give you some inspiration. Analyst Graham Spooner of the Share Centre picks what he believes are five of the hottest AIM prospects:
“Breeedon Aggregates is a smaller AIM listed company that is geared to a recovery in infrastructure spend. With the outlook for construction in the UK looking more positive than it did last year we recommend it as a ‘buy’ for investors prepared to take a longer term view.
“Despite sluggish infrastructure spend from hard pressed local councils the company’s margins have been improving and it has been positioning itself to benefit from any pick-up in the economy. A number of acquisitions have been made, financed by share placings, which should help expand its geographical presence in the UK and debt has continued to fall to £72.2m.”
Hutchison China Meditech
“The business is focused primarily on China and as the Chinese population becomes more affluent there is a significant upturn in those signing up for medical insurance and also spending by the government on national healthcare. To give an indication of the potential market, the average spent on healthcare in the US is around $8,000 per person per year while the average in China is just below $200.
“There has been positive news flow about drug trails and joint ventures with Astrazeneca and Nestle Health Sciences. Research and development costs in China are far lower than in Western countries and products can be brought to the market in a shorter timeframe. This is a high risk opportunity for investors seeking exposure to China.”
“Monitise’s global ambitions have been helped by a number of acquisitions in the last financial year and there has been renewed interest in the company as it completed new deals with IBM and Telefonica. Monitise continues to head in the right direction, with the shares up over 100% since our first recommendation.
“We recommend investors ‘buy’ Monitise for a high risk, early stage investment opportunity. The company continues to attract high calibre partners and customers, helping to firmly integrate its proposition as the preferred interface between financial institutions and their customers globally.”
“Since coming to the market in May 2012, the share price has made steady headway. The company has a presence in around 80 countries and 2000 dealerships, with established relationships with BMW, Nissan, Mercedes and VW. It is currently concentrating on developing into emerging markets, especially the BRIC markets (Brazil, Russia, India, China), where opportunities are far greater than parts of Europe. Incadea is making excellent progress with increased demand from clients and this is expected to be reflected in an improving revenue stream. This is a higher risk smaller company for the medium to longer term, which is establishing itself across the globe in a niche market.”
As this is a small oil and gas exploration firm operating in a potentially unstable region, it represents a very high risk investment. The company has made significant progress in recent years, turning exploration projects into productive assets. The target is to double the 2012 production rate by the end of 2013. With production increasing at a rapid rate, the company is expecting to build on last year’s performance with net margins expected in the region of 45% higher. The company also has no debt on its books.”