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Stock markets have been – and continue to be – wretched everywhere. But if you had backed every one of our Company Watch and Company Profile recommen-dations in 2002, and adhered to the invaluable stop-loss system we advocate, you would have made a loss of just 0.4 per cent during this period.

This may not seem like much until you realise that in this time the FTSE has collapsed 25.2 per cent, techMARK 54.6 per cent and Aim 33 per cent.

Our stop-loss system (see box opposite for our investment policy) would have enabled you to pocket gains of 86.7 per cent at Claims People, which improved from our recommendation price of 1.5p to 3.5p before falling with the rest of the market.

It would also have allowed you to make a handsome 25.0 per cent gain at K3 Business Technology, a very welcome 15.5 per cent appreciation on our Aero Inventory tip, and a 20.9 per cent profit at Tolent.

You would have significantly reduced your losses in a whole host of stocks, both good and bad, that fell sharply as an ever-increasing flood of fear gripped the City. And perhaps most importantly, the stop-loss limited your exposure to our disaster stocks, especially SFI and Ingenta, both of which 'discovered' large black holes in their accounts.

Star performers

Happily, not all of our recommendations needed the application of the stop-loss. Our best performing share – which incidentally, still shows no sign of weakening – is Eckoh Technologies, the telecoms services group.

Under the guidance of chief executive Martin Turner, Eckoh has been transformed from a moribund web play into one of the pre-eminent call processing and telephone speech solutions groups in Europe.

Since our recommendation at 6.5p, Eckoh has soared to 13.5p as its interactive voice response, network services and mobile wholesale divisions all remained profitable despite the chaos in the telecoms market.

Even more exciting was the fact that its innovative speech solutions arm – the loss-making but potentially most profitable division – signed a groundbreaking deal with BT.

Eckoh is expected to post an operating profit of around £400,000 for 2002 on sales of around £60 million. Many analysts reckon the cash-rich company could be in the black at the pre-tax line in 2003.

At 13.5p, it is valued at £30 million. Those who bought at 6.5p should top-slice their investment and leave the remainder in for free.

Danka Business Services is another where a spot of profit-taking would not go amiss. Its interim results showed profits up £6.6 million and company debts reduced. Forecasters are expecting full year, pre-tax profits in the region of £14.8 million.

At present, the 77.75p shares sit at a premium of 88.5 per cent to our original recommendation of 41.25p. Top slice.

Keep holding

Other companies currently boasting good gains that should continue to be held firm include Chaucer, the quoted vehicle that backs Lloyd's market insurance syndicates. It has improved 33p to 41.5p, a gain of 25.8 per cent.

Belhaven Brewery also remains a firm favourite as well. The interim results here showed a 20 per cent hike in pre-tax profits to £6.04 million on sales up from £34.9 million to £39.4 million as the freehold estate grew from 152 (in April 2002) to 163 pubs.

For the full year, the expectation from house broker ING Barings is that the company will make around £10.5 million pre-tax, which should deliver earnings per share of 33p.

At the current share price of 352.5p – up from our original recommendation price of 300p – the group is valued at £75.69 million. Keep holding.

Magazine group Future Network continues to perform, with a buoyant trading statement prompting a raft of analysts, including house broker UBS Warburg, to upgrade their expectations for the year. Warburg now expects pre-exceptional, pre-tax profits of £15.5 million on sales of £166 million for 2002. For 2003, it has factored in sales of £179.6 million and pre-exceptional profits of £20 million.

At 52.5p, Future's shares sit at a 11.7 per cent premium to our original October recommendation price of 47p. The shares are not to be sold.

Unsurprisingly, a raft of our recommendations are treading water despite the fact that they have put in solid business performances.

Hamleys, the toy retailer, remains 4.1 per cent off our buy price, despite recording a generally solid Christmas trading period.

Sanctuary, the music group, has fallen through its stop-loss and now trades at 45.5p (market value £119.75 million). This level is a gross undervaluation. Its full year results showed profits growing 25.6 per cent to £14.2 million on sales up 44 per cent to £118.1 million.

In addition, it has been energetic on the deals and acquisitions front and a triumvirate of brokers – Williams de Broe, Old Mutual and Baird – all rate the stock a buy. Baird, for instance, is looking for profits this year of £16.5 million and earnings per share of 4.5p, giving it a forward p/e of 10.1. Buy.

Blick leads the way

In terms of the most recent Company Watch picks, security, communications and time management systems group Blick is leading the charge, having registered an 10.4 per cent gain since December.

The group impressed the market by producing a profit of £7.8 million on sales of £67.5 million despite operating in difficult markets and instigating a restructuring drive.

While the shares remain under 240p (current price 192.5p), Investec reckons they are a good value buy.

Wyndeham Press is an equally good buy despite not having moved from the 128.5 tip price.

Over at House of Fraser, the retailing empire, events have gone quiet (and the shares have fallen back) since Tom Hunter announced he was not proceeding with a bid for the department store group. Although Hunter cannot come back with a bid for another six months, others may enter the fray. Even without the bid speculation, House of Fraser remains a company with solid fundamentals.

Helphire moves into gear

Shares in accident management specialist Helphire, profiled in December's Growth Company Investor at 165.5p, are riding at a 12-month high of 181.5p, despite recent share sales by directors.

The group, whose services include providing hire cars for innocent motor accident victims whose vehicles are wrecked, nearly foundered two years ago when the insurers that footed these bills refused to pay. More recently, an agreed 'protocol' with the Association of British Insurers has allowed the fully-listed company to thrive again – with half-year pre-tax profits to September at £1.8 million, twice the previous full year's £929,000.

Against this background, finance director David Lindsay and his wife Amanda together sold around 40,000 shares, held under PEP and ISA schemes, and jointly retain 70,000. Soon after the interim figures were released, co-founder Michael Symons sold 670,000 shares, a fifth of his holding, at 164.5p, to buy a property in France.

The company's advisers point out that this sale still left Symons with 2.67 million shares, 2.2 per cent of Helphire. Mark Jackson, who founded the company with Symons, is understood to be committed to retaining his full stake.

Analyst Mark Paddon at Deutsche Bank admits that 'share sales by directors always cause anxiety', but he says the market seems satisfied with the reasons given. Business is still picking up at Helphire and the shares have doubled since last year's low — though they are still trading at less than half the 1998 levels. Keep holding.