Begbies Traynor (BEG:AIM) 89p

Gain to date: 1.1%

Original entry point: Buy at 88p, 19 December 2019

While a 1% gain is normally little cause for celebration, given the events of the past year and the fact the FTSE All-Share is nursing losses of more than 8%, we’ll take a small gain as a win.

Begbies’ chief executive Ric Traynor described the firm’s performance in the first half to October as ‘moving forward in very difficult circumstances’, which underplays the 11% rise in turnover, a 25% rise in profits and an increase in the dividend.

Considering the extent to which state support has limited the number of insolvencies, the business recovery and financial advisory division delivered good top-line growth thanks to prior-year acquisitions and an element of underlying improvement.

The property advisory business suffered from the complete closure of the commercial property market during the first lockdown, and while activity has recovered swiftly the market has not yet recovered to pre-Covid levels.

However, the firm reports that there has been no significant impact on its businesses during the second period of lockdown.

Crucially, the company is well-capitalised ahead of what is likely to be a ‘tidal wave’ of insolvency work next year once support is reduced, and it has been hiring fee earners to bolster its market-leading franchise.

SHARES SAYS: Stick with Begbies as a savvy counter-cyclical bet. 

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