LONDON -- A profit warning that wiped 37% off shares of Cape (LSE: CIU.L ) saw the engineering services contractor become the single-most popular purchase by stockbroker TD Direct Investing's individual clients between the market's opening and noon.
And somewhat peculiarly, the share was also the most sold share by TD Direct Investing's individual clients, as investors doubtless bore in mind the old adage about profit warnings coming in threes -- and yes, this is the third warning since November.
That said, investors may also be bearing in mind that Cape has a history of collapses followed by strong recoveries -- and as my Foolish colleague Maynard Paton points out, given that history, it might well pay to keep an eye on Cape for another recovery. A 50-fold rise from here is certainly an appealing prospect.
Troubled insurance group Aviva (LSE: AV.L ) was the eighth-most popular share purchase by TD Direct Investing's retail clients this morning. There was doubtless the usual element of bottom-fishing at work as investors salivated over Aviva's sky-high forecast yield of 9.5% and forecast price-to-earnings ratio of 5.4. But for once, there was also good news to cheer, as well.
Following incoming chairman John McFarlane's declared policy of selling off noncore assets, this morning the company announced that it has completed the sale of its Czech, Hungarian, and Romanian Life businesses to MetLife's local operating subsidiaries in those countries. Completion of the sale of Aviva's Romanian Pensions business is expected to occur later this year, subject to regulatory approval, returning more still cash to the insurer's stretched balance sheet.
Finally, the theme of disposals continues, with news from Premier Foods (LSE: PFD.L ) attracting buyers of the company's shares and making it the 10th-most popular share purchase by TD Direct Investing's retail clients this morning. The company has completed the disposal of its vinegar and sour pickles operations -- including the Sarson's, Hayward's, and Dufrais brands -- to Japan's Mizkan for a cash consideration of 41 million pounds, subject to a post-completion stock adjustment.
Premier remains in the recovery ward on a P/E of just more than two and with no dividend, but investors buying today will doubtless be hoping management can slim down the business, sort out the finances, and finally earn value from what remains a core clutch of decent brands.
Will they be disappointed? Time will tell.
Finally, what are super investors Neil Woodford and Warren Buffett buying today? We can't tell you that, but we can tell you the names of the shares they've been buying in the recent past -- and why they've been buying them.
Investing ideas from Malcolm Wheatley:
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