MoneyWeek’s comprehensive guide to this week’s share tips
Five to buy QinetiQ The Telegraph
QinetiQ’s shares have doubled since 2017. The defence contractor’s upgraded guidance, rising revenue, stable profit margin and potential for future acquisitions reflect its solid financial position. With Nato members expected to increase defence spending and a modest price/earnings (p/e) ratio, the company’s capitalgrowth potential and sharebuyback programme make it an attractive investment. Some investors may be tempted to sell after large gains, but it’s “more logical” to keep buying. 451p
Sanderson Design Group The Sunday Times
Sanderson Design Group, a luxury interior-furnishings business hit by the housingmarket slowdown, has made significant improvements despite challenging conditions. It has increased inventory, boosted margins, and pocketed record licensing revenues from its designs. It has a solid balance sheet and has seen strong growth in the US. Falling inflation and increased consumer confidence after the general election could help the stock. 106p
Oakley Capital Investments The Mail on Sunday
Private equity has a bad reputation, but Oakley Capital Investments is different. It focuses on helping companies grow by working with management and taking a conservative approach to debt. It has a portfolio of 28 companies, and recently invested in a French healthcare consultancy and a German broadband business. Oakley’s shares are a “bargain”, with the group’s investments valued at 693p a share. The stock has risen by 18% in two years and there is further to go. 490p
On the Beach Shares
Investors are taking notice of On the Beach (OTB) after positive first-half results and an analyst upgrade. The online package-holiday provider trades at just 8.6 times its September 2025 forecast earnings and is returning to meaningful dividend payments. There is potential for further market-share growth in the long-haul and premium holiday markets. OTB has also secured a partnership with budget carrier Ryanair, and consumers’ appetite for travel is expected to remain healthy. OTB is a “big value opportunity” for investors. 142p
One to sell Petrofac Investors’ Chronicle
Petrofac has missed a coupon payment and is in default. The energy engineering and services company is seeking a cash injection of $300m to avoid insolvency, but not all lenders support the rescue package. Liabilities amount to $1.7bn, and Petrofac experienced a $222m cash outflow in 2023. Despite an $8bn order backlog, new contracts, and the wider industry’s rude health, Petrofac’s future looks uncertain. “Most
Paragon Bank Investors’ Chronicle
Paragon’s strong interim results bode well. With robust deposit growth, a higher net-interest margin, and improving mortgage and commercial lending, underlying pre-tax profit at the specialist lender rose by 13.5% to £146m. Signs of recovery have prompted Paragon to upgrade lending and net-interest margin guidance for the year. It’s “difficult to argue with the quality of the earnings and the expected shareholder returns”. 749p investors probably left the sinking rig some time ago,” but those that didn’t will hope there’s something to salvage now its shares are no longer suspended. 22p