THE PROS’ TOP PICKS
Pinnacle – It has a great management team that has positioned the business profitably in the computer hardware (and, more recently, software) distribution value chain in South Africa.
The attractive valuations of Clover, Peregrine, ISA Holdings, Transaction Capital, Calgro M3 and Jasco are why I currently like these small caps.
Ellies Holdings (645c) – I like the stock as its move into infrastructure (power & telecoms) has led to a dramatic surge in its earnings ability as it expands into this sector especially into Africa. Earnings growth has been strong and on a forecast P/E of 8 times, I think the stock is well priced and I have a target price of 1200 cents.