Experian plc (EXPN), Intertek Group plc (ITRK): Should I Buy These Shares?

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LONDON — I’ve been popping stocks into my shopping basket in recent weeks and it’s time I took one or two to the checkout. Here are five tempting stocks from April. Should I buy any of them?

Credit-reference agency Experian plc (LON:EXPN) has plenty of data on you, but how do its numbers stack up?

In April, I was impressed by the group’s sturdy revenue growth, both in the troubled West and expanding emerging markets, and a 222% rise in its share price over five years.

Its full-year results, published in May, showed a 7% rise in earnings before interest and tax to $1.25 billion, and a healthy 10% rise in revenues to $4.7 billion.

Net debt did rise from $1.92 billion to $2.9 billion, as the group bought a further a stake in Brazilian firm Serasa to secure its growth in the country. Experian is also expanding into new markets, notably Turkey, Colombia, Russia, and Chile.

But the market cap isn’t cheap, trading at more than 21 times earnings despite a 7% drop in the share price in recent weeks. Nonetheless, Experian plc (LON:EXPN)’s global expansion prospects and forecast earnings per share (EPS) growth of 13% to March 2014 and 10% to 2015 make the company a solid prospect.

Experian looks positively cheap against unsung FTSE 100 hero Intertek Group plc (LON:ITRK), which traded at a whopping 26 times earnings in April.

Intertek Group plc (LON:ITRK)

Yet shares in this quality and safety services specialist have fallen 12% since mid-May, after a downbeat first-quarter statement revealed tougher trading conditions for its commodities business, with a surprise fall in minerals-related revenue.

The slide is expected to continue for some time. Falling profit margins and a 5.7 million pound rise in financing costs, to 26.7 million pounds, overshadowed a 9.9% rise in group revenue and a 22% rise in total dividend payment for 2012.

Management remains positive, claiming Intertek Group plc (LON:ITRK) will continue to drive growth through “organic investment, new services and innovation, and value-adding acquisitions.”

But I don’t like nasty surprises, especially from a company now valued at 23 times earnings, and yielding just 1.3%, against 12.6% and 3.6% for the FTSE 100 as a whole.

ITV plc (LON:ITV) looked essential viewing in April, and has shrugged off stumbling markets to climb another 5% since then.

Yet the broadcaster’s first-quarter statement was a bit of a turn-off, with management cautious about television advertising income and a 5% drop in revenues at ITV Studios. With no big football tournament this summer, this year is likely to disappoint.

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