ANCHOR GROUP Good prospects

Wealth and asset management company Anchor Group has mushroomed from R265m in market value on the JSE to a R1,2bn company in just under five months since its listing on the bourse last year.

Some analysts are confident that the market gains are sustainable should the company take on more assets under management. One of the views is that the company will have to issue stronger earnings to justify its valuation.

So far this year the Anchor Group share price has risen by about 27%. The JSE all share index is down about 2%.

When the Anchor Group was listed in September last year its shares were issued at R2 and now the stock is trading at over R9, an increase of about 350% in just under five months.

“It appears to have quite good prospects. It has driven a lot of retail investor optimism,” says Keith McLachlan, a small- and mid-cap fund manager at Alpha Wealth.

He says the share is quite expensive at current levels and stronger earnings are needed to justify the valuation.

“At these levels, if they put out good numbers the market may be excited. The valuation sets the bar very high for future results,” McLachlan adds.

Vunani Securities equity analyst Anthony Clark says Anchor Group is among his top five picks for 2015 alongside Torre Industries, Curro Holdings and Quantum Foods.

“Even after a stratospheric fourth quarter I can see earnings (and deals) continuing the stock’s momentum and thus set