Jet2, Optima Health & new stock screens: The Companies and Markets Show

·33 min·3 clips

Why did two successful AIM stocks, Jet2 and Optima Health, see their shares fall after reporting seemingly good annual results?

Host Dan Jones opens the episode by introducing two stocks on the AIM index that have performed well over the past year but saw share price declines this week. The first segment focuses on Jet2, with Mike Fahey discussing its full-year results, including a 15% revenue increase and 12% pre-tax profit growth. Despite operational strength, shares fell due to concerns over short-term bookings and a significant capacity expansion plan involving 155 new planes over ten years, with capital expenditure rising to about £1 billion annually from 2027. The conversation shifts to demand, with Jet2's CEO noting strong holiday appetite and efforts to target younger, less affluent demographics. Valuation comparisons place Jet2 at eight times earnings, lower than Ryanair's 13 times. The second segment covers Optima Health, with Julian Hoffman explaining its role as an occupational health consultancy spun off from Marlowe. Its results showed stable revenue, but growth relies on acquisitions, such as the recent purchase of Cognate Health in Ireland. Investors are wary of future capital raises to fund this buy-and-build strategy, and the stock trades at a low price-to-book ratio of one. The final segment, with Alex Newman, addresses the shrinking UK market, which has about 500 companies valued over £100 million, down from 1,300. This prompts the introduction of expanded global stock screens using the MSCI All Countries World Index. Newman plans to adapt successful UK screens, like the Great Expectations screen, but notes challenges such as withholding taxes and the risk of selecting hype stocks. The episode concludes with an invitation for listener feedback on the new screening approach.

As heard by us

A clear, measured review of two pressured AIM shares, led by Optima's contract-led growth story and funding caveat.

Two AIM-listed businesses set the shape of a Companies and Markets Show caught between solid operating updates and softer share prices. Dan Jones brings in Jet2 after its full-year figures and Optima Health after annual results, with Mike Fahey and Julian Hoffman weighing stocks…

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Why you'd press play

You want the patient read on why Jet2 and Optima Health sold off after results, plus what Investors' Chronicle's expanded stock screens are meant to surface next.

Read the full recommendation in PlayNext →

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