GREAT IDEAS
14 | SHARES | 23 May 2019
S
ŚĂƌĞƐŝŶƌĞĐƌƵŝƚŵĞŶƚ
ĮƌŵSThree (STHR) are
ƌĞĂůůLJĐŚĞĂƉǀĞƌƐƵƐƚŚĞ
ĐŽŵƉĂŶLJ͛ƐŐƌŽǁƚŚƉƌŽƐƉĞĐƚƐ͘
ƵLJƚŚĞƐƚŽĐŬŶŽǁĂƐŝƚƐŚŽƵůĚ
ĞŝƚŚĞƌƌĞͲƌĂƚĞŝŶůŝŶĞǁŝƚŚƉĞĞƌƐ
ŽƌĂŶŽǀĞƌƐĞĂƐƌŝǀĂůĐŽƵůĚĐŽŵĞ
ĂŶĚŐŽďďůĞƵƉƚŚĞďƵƐŝŶĞƐƐ͘
^dŚƌĞĞŝƐĂŐůŽďĂůƉůĂLJĞƌ
ƐƉĞĐŝĂůŝƐŝŶŐŝŶƚŚĞĮĞůĚƐŽĨ
ƐĐŝĞŶĐĞ͕ƚĞĐŚŶŽůŽŐLJ͕ĞŶŐŝŶĞĞƌŝŶŐ
ĂŶĚŵĂƚŚĞŵĂƟĐƐ;^d DͿ͘
/ƚƉƌŽǀŝĚĞƐƉĞƌŵĂŶĞŶƚĂŶĚ
ĐŽŶƚƌĂĐƚƐƚĂīƚŽƚŚĞŝŶĨŽƌŵĂƟŽŶ
ĂŶĚĐŽŵŵƵŶŝĐĂƟŽŶƐƚĞĐŚŶŽůŽŐLJ
ƐĞĐƚŽƌ͕ĂƐǁĞůůĂƐƚŽƚŚĞďĂŶŬŝŶŐ͕
ĮŶĂŶĐĞ͕ĞŶĞƌŐLJ͕ĞŶŐŝŶĞĞƌŝŶŐĂŶĚ
ůŝĨĞƐĐŝĞŶĐĞŝŶĚƵƐƚƌŝĞƐ͘
'ŝǀĞŶŝƚƐĨŽĐƵƐŽŶ^d D
ƌĞĐƌƵŝƚŵĞŶƚ͕ǁŚŝĐŚŚĂƐĂŚŝŐŚĞƌ
growth rate than the overall
ŵĂƌŬĞƚ͕ĂŶĚŝƚƐƐƚƌĞŶŐƚŚŝŶ
ĐŽŶƚƌĂĐƟŶŐǁŚŝĐŚŝƐůĞƐƐĐLJĐůŝĐĂů
ƚŚĂŶƉĞƌŵĂŶĞŶƚƌĞĐƌƵŝƚŵĞŶƚ͕ǁĞ
ďĞůŝĞǀĞƚŚĂƚ^dŚƌĞĞƐŚŽƵůĚƚƌĂĚĞ
ŽŶĂƚůĞĂƐƚƚŚĞƐĂŵĞǀĂůƵĂƟŽŶ
ŵƵůƟƉůĞĂƐŝƚƐŐůŽďĂůƉĞĞƌƐƌĂƚŚĞƌ
ƚŚĂŶĂϯϬйƚŽκϬйĚŝƐĐŽƵŶƚ͘
dŚĞ^d DŵĂƌŬĞƚƐǁŚŝĐŚ
ƚŚĞďƵƐŝŶĞƐƐƉƌŝŵĂƌŝůLJƐĞƌǀĞƐ
ĂƌĞƐĞĞŝŶŐŚŝŐŚŐƌŽǁƚŚĂŶĚ
ĂƌĞĐƌŝƟĐĂůůLJƵŶĚĞƌͲƐƵƉƉůŝĞĚ
ǁŝƚŚƚĂůĞŶƚ͘dŚĞƌĞĨŽƌĞ^dŚƌĞĞŝƐ
ǁĞůůƉůĂĐĞĚƚŽĐŚĂƌŐĞŵŽƌĞƚŽ
ĮŶĚƐƵŝƚĂďůĞĐĂŶĚŝĚĂƚĞƐ͘/ŶƚŚĞ
h<͕ũŽďƐŝŶƐĐŝĞŶĐĞ͕ƌĞƐĞĂƌĐŚ͕
ĞŶŐŝŶĞĞƌŝŶŐĂŶĚƚĞĐŚŶŽůŽŐLJĂƌĞ
ƉƌĞĚŝĐƚĞĚƚŽŐƌŽǁƚǁŝĐĞĂƐĨĂƐƚ
ĂƐŽƚŚĞƌĐĂƌĞĞƌƐǁŚŝůĞƚŚĞh^
ŵĂƌŬĞƚĨĂĐĞƐĂĚĞĂƌƚŚŽĨŽǀĞƌϭŵ
ǁŽƌŬĞƌƐĨŽƌ^d DƌŽůĞƐďLJϮϬϮκ
ĂĐĐŽƌĚŝŶŐƚŽƚŚĞĮƌŵ͘Specialism in high growth markets should drive a revaluation of the sharesSThree has big growth
prospects and cheap shares
^dŚƌĞĞ͛ƐŶĞǁĐŚŝĞĨĞdžĞĐƵƟǀĞ
DĂƌŬŽƌŵĂŶ͕ǁŚŽũŽŝŶĞĚƚŚĞ
ďƵƐŝŶĞƐƐŝŶDĂƌĐŚ͕ďƌŝŶŐƐĂ
ǁĞĂůƚŚŽĨĞdžƉĞƌŝĞŶĐĞŝŶŚĞůƉŝŶŐ
ŝŶƚĞƌŶĂƟŽŶĂůďƵƐŝŶĞƐƐĞƐƐĐĂůĞƵƉ
ĂŶĚŐƌŽǁƚŚĞŝƌŵĂƌŬĞƚƐŚĂƌĞ͘
,ĞƐĂLJƐ͚͗^dŚƌĞĞŝƐŝŶĂŶ
ŝŶĐƌĞĚŝďůLJƐƚƌŽŶŐƉŽƐŝƟŽŶĂŶĚ
ŝƚƐĨŽĐƵƐŽŶďĞŝŶŐƚŚĞŶƵŵďĞƌ
ŽŶĞ^d DƚĂůĞŶƚƉƌŽǀŝĚĞƌŝŶ
ƚŚĞďĞƐƚ^d DŵĂƌŬĞƚƐŝƐƚŚĞ
ƌŝŐŚƚƐƚƌĂƚĞŐLJ͘
͚dŚĞƐĞŵĂƌŬĞƚƐĂƌĞƐĞƚƚŽŐƌŽǁ
ƐŝŐŶŝĮĐĂŶƚůLJǁŝƚŚǁŚŽůůLJƉŽƐŝƟǀĞ
ƐĞĐƵůĂƌƚƌĞŶĚƐ͘dŚŝƐƉƌĞƐĞŶƚƐĂ
ƚƌĞŵĞŶĚŽƵƐŽƉƉŽƌƚƵŶŝƚLJĂŶĚŽƵƌ
ƉƌŝŽƌŝƚLJŝƐƚŽĚƌŝǀĞŐƌŽǁƚŚƚŚƌŽƵŐŚ
ĂĚĂƚĂͲůĞĚĂƉƉƌŽĂĐŚǁŚŝůĞ
ĞŶŚĂŶĐŝŶŐŽƵƌŐůŽďĂůƉůĂƞŽƌŵƚŽ
ĨƵůůLJĐĂƉŝƚĂůŝƐĞŽŶƚŚĞƐƵďƐƚĂŶƟĂů
ŽƉƉŽƌƚƵŶŝƟĞƐĂŚĞĂĚŽĨƵƐ͛͘dŚĞĨŽĐƵƐŽŶĐŽŶƚƌĂĐƚ
ƌĞĐƌƵŝƚŵĞŶƚ͕ǁŚŝĐŚŵĂŬĞƐƵƉ
ŽǀĞƌϳϬйŽĨƌĞǀĞŶƵĞƐ͕ŐŝǀĞƐŝƚ
ǀŝƐŝďŝůŝƚLJŽĨĞĂƌŶŝŶŐƐŝŶƐƚƌŽŶŐ
ŵĂƌŬĞƚƐĂŶĚƌĞƐŝůŝĞŶĐĞŝŶ
ƵŶĐĞƌƚĂŝŶƟŵĞƐ͘
ůƐŽŝƚƐŐĞŽŐƌĂƉŚŝĐ
ĚŝǀĞƌƐŝĮĐĂƟŽŶ͕ǁŝƚŚŽǀĞƌΘϬй
ŽĨƌĞǀĞŶƵĞƐŐĞŶĞƌĂƚĞĚŽƵƚƐŝĚĞ
ƚŚĞh<ĂŶĚ/ƌĞůĂŶĚŝŶŵĂƌŬĞƚƐ
ůŝŬĞƚŚĞh^͕:ĂƉĂŶĂŶĚ'ĞƌŵĂŶLJ͕
allows it to pursue growth
ŽƉƉŽƌƚƵŶŝƟĞƐǁŚĞƌĞǀĞƌƚŚĞLJ
ŽĐĐƵƌǁŚŝůĞůŝŵŝƟŶŐŝƚƐĞdžƉŽƐƵƌĞ
ƚŽŝŶĚŝǀŝĚƵĂůŵĂƌŬĞƚƐ͘
DĂƩŚĞǁdŝůůĞƩ͕ŵĂŶĂŐĞƌŽĨ
ůůŝĂŶnjh<KƉƉŽƌƚƵŶŝƟĞƐ&ƵŶĚ
(B8BB944)͕ŝƐĂůƐŽĂĨĂŶŽĨƚŚĞ
ƐƚŽĐŬ͘,ĞƐĂLJƐ͚͗dŚĞǀĂůƵĂƟŽŶ
ĂƚΘƚŽεƟŵĞƐĞĂƌŶŝŶŐƐŝƐ
ĂƩƌĂĐƟǀĞďŽƚŚŝŶƌĞůĂƟǀĞĂŶĚ
ĂďƐŽůƵƚĞƚĞƌŵƐ͕ĂŶĚŝŶŶŽǁĂLJ
ƌĞŇĞĐƚƐƚŚĞĞdžĐĞůůĞŶƚůŽŶŐͲƚĞƌŵ
ŐƌŽǁƚŚƉƌŽƐƉĞĐƚƐŽĨƚŚĞďƵƐŝŶĞƐƐ
ŽƌƚŚĞŐƌŽǁƚŚƉŽƚĞŶƟĂůŽĨ
ƚŚĞĐŽŵƉĂŶLJ͛͘STHREE È BUY
(STHR) 290p
Stop loss: 230pMarket value: £380m240280320360400
STHREE2018 2019Building
Annual Report andthe future
Building the future Accounts 2018
Annual Report andAccounts 2018^Building
the future
Annual Report and Accounts 2018