Companies: CC.   

Christmas trading is of vital importance to Clinton Cards, the High Street retailer of cards and wrapping paper. It traditionally makes a loss in the first six months to July, then makes up the ground in the second six months to January. Clinton is expected to make a trading statement at the end of next week, which should detail its performance over the crucial Christmas season.

Without wishing to second guess the Clinton management, the signs are good. As has been widely reported over the last few weeks, High Street spending in the run-up to Christmas and in the early January sales has been at record levels. This should suggest strong trading for Clinton, although nothing is guaranteed.

Adrian Kearsey of house broker Beeson Gregory is cautiously optimistic. 'Clinton should do well this year, although it never turns in spectacular results. The emphasis is really on the management of the portfolio of shops rather than astonishing growth'.

Yet Clinton still represents good value, trading at around 7.5 times current year earnings, and dropping to 6.8 times for 2003 earnings. As Kearsey say, this makes it very cheap relative to its peer group.

Since we recommended the shares at 165p in our November issue, the shares have been treading water near the 160p level. The keenly anticipated trading statement, due out on or near Thursday of next week, should move the shares ? hopefully in the right direction.

Hold on for the trading statement.