One to Watch: Recovering nicely

WYNNSTAY Group manufactures and supplies agriculture products to farmers and the rural community in Wales, the English Midlands and Lancashire. The company operates in two business divisions, agriculture supplies and specialist retail, which includes the company's store business and pet products.

Wynnstay's feed division is a supplier of nutrition products for all species of livestock, with manufacturing facilities in Llansantffraid and Carmarthen. The group's retail division operates through country stores, with 28 outlets in the North and Mid Wales and the West Midlands. In addition, it has 15 Just For Pets stores, with a 16th due to be opened soon. The group aims to add three or four new stores each year.

Wynnstay is comparatively small, but its business model looks sound. The company recently reported pre-tax profits of 5.12 million for the year to 31 October, 2009, on revenue of 215m. This translated into an earnings per share figure of 26.4p, and the company paid a dividend of 6.5p.

The group confirmed that agricultural supplies activity saw reduced demand for feed and fertiliser, a reflection of the challenges being faced by the agricultural community.

On the other hand, the Just For Pets division saw revenues rising 16 per cent, helped by two new stores opening. The group is also supported by a strong balance sheet.

Last year was a tough one for arable farmers, so the company's performance was impressive in the circumstances.

Quoted on AIM, Wynnstay looks like a good example of a well-run business. The shares have been recovering from the near-160p level they plumbed at the beginning of 2009.

The value of your investment could fall and you may get back less than you invested. You should take professional advice if you have any doubt about the suitability of this company for your portfolio.

Hays

105p +0.70p

Broker says BUY

DESPITE a tough climate for recruiters, Royal Bank of Scotland believes Hays will outperform over the next three to four quarters. The broker says: "Consensus is bearish due to public sector exposure, lack of positive estimate momentum and dividend concerns." RBS added: "We believe the payout will be maintained."

Goals Soccer Centres

151.75p +5.75p

Broker says ADD

NUMIS has upgraded its recommendation on the East Kilbride-based Goals from "hold" to "add", following the publication of its full-year results yesterday. The broker said: "Although profit per site has fallen for two consecutive years, the model is not broken. Due to recent weakness, we are upgrading our stance."