Companies: CPU    DLTA    ILX   

Analyst Paul Bates remains bullish on business education and training group ILX despite its April profits alert. The year to March was actually one of significant growth, with turnover surging 50 per cent higher to £10.34 million and pre-tax profits coming in at £1.46 million, buoyed by £12.3 million acquisition CTG and the core training business of the Best Practice division. Mount Lane and Customer Projects proved disappointments.
Bates concedes that management must regain confidence while criticising the market’s overreaction, pointing out ‘the core of ILX remains high growth and high margin, and CTG continues to perform excellently’. He underscores his ‘add’ stance by noting that ‘should the company remain on track’, the 69p shares ‘should then look very cheap’ on forward p/e ratios of 9.5 and 7.7.

Susan Gordon initiates coverage with a buy on former manufacturing conglomerate Delta and a 12-month target price of 170p. Off investors’ radars during a restructuring bout, the business has emerged from substantial disposals with three businesses generating solid profits and cash, and formidable growth firepower (£107 million of year-end cash). ‘With the majority of the disposal programme now complete and the prospect of some interesting growth opportunities to come,’ she writes, ‘it is time to revisit Delta as a potential investment prospect.’

Peter Ashworth has a buy and a 280p target for IT services group ComputerLand, currently 246p. Record results for the year to 30 April were driven by managed services, with profits growing 26 per cent to £2.8 million on improved sales of £67 million. Year-end net cash was £8.4 million, even after substantial dividend payments.