EVIDENCE of growing activity in the UK economy was supported by a trading update from equipment hire firm Speedy Hire last week.
The firm, which rents out power tools and portable accommodation, reported a good start to the year with sales in the UK and Ireland set to see double-digit growth in 2014.
In its international division, revenues were up by approximately 31 per cent year-on-year. Although the company said actions to get its Middle East division – hit by an accounting scandal last year – back on track were having a positive effect, “the flow through to profitability is taking longer than expected”.
Overall it expects to meet its forecasts for the full year.
Analysts at Investec believe that, after a tough period for the company, the update suggests things are starting to look more promising for the firm.
“This has been a challenging period for Speedy Hire. However, with the new board structure taking shape and a new strategy being implemented, the outlook is beginning to look more positive.
“This clearly will not be an overnight turnaround, but once the Middle East is fully resolved, the underlying strength of trading in the UK should feed through quite significantly to forecasts.”
The broker has a buy rating on the shares, with a 100p price target.
Peel Hunt also reiterated its hold rating on the shares, but with a 60p price target.
• Shares in DQ Entertainment perked up last week after it announced a deal with an Italian broadcaster to develop a new animated series for children based around a character named Pio The Chick.
The two will produce 52 episodes, with broadcast expected from 2016.
Tapaas Chakravarti, DQE’s chairman and chief executive, said the deal was a significant one as it marked the beginning of a partnership with Rai, one of the leading broadcasters in Italy.
“This deal further validates DQE’s capabilities in producing world-class content and the trust our partners around the world have in us.”
Shares in the firm, trading at around 10p last week, are still well down on their year high of 29p seen in January.
Monday: Sports Direct (trading)
Tuesday: BP Marsh (I)
Wednesday: Home Retail (I)
Thursday: Debenhams (F)
Friday: Shire (Q3)