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Share Centre share of the week: RPC Group

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15/06/2015
Ian Forrest, investment research analyst at The Share Centre, picks RPC Group as share of the week.

This week, international plastic packaging company RPC Group is one to watch for medium risk investors. With its full year results revealing figures ahead of expectations and revenues up 17 per cent, the group is a leader in its sector and supplies to brand such as Ragu, Nivea and Dulux.

As well as outperforming the market over the past year, the group’s earnings and dividends are expected to grow by 25 per cent over the next two years in contrast to more modest expectations for its UK peer, Rexam. Investors should also note that, contrastingly, the group’s shares are trading on an attractive 2017 price/earnings multiple of 12.5 which is slightly lower than Rexam.

RPC’s current success may be due to the company’s new growth strategy, adopted last year, which aims to grow sales in the US and Asia organically and through acquisitions. The move to Asia is particularly attractive, and investors should note that these markets are fast-growing.

We are recommending RPC as a ‘buy’ for investors, especially those looking to achieve a mixture of income and growth, due to the group’s current good health, excellent track record and bright prospects for the future.

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