After some mental gymnastics, Richard confirms Autotrader and Tatton have no major blemishes in their financial histories. Tatton, in particular, looks like a very good business. Five companies achieve less than three strikes and go on his research list.
5 Strikes
Since my last update, 13 of the companies listed in London that published annual reports passed my minimum quality filter:
| Name | TIDM | Prev AR | Strikes | # Strikes |
|---|---|---|---|---|
| BTG | BTG Consulting | 7/7/26 | ? Acquisitions ? CROCI – ROCE – Shares | 3 |
| POLR | Polar Capital | 3/7/26 | ? Holdings – Growth | 2 |
| CWK | Cranswick | 30/6/26 | ? Growth | 0 |
| CGS | Castings | 29/6/26 | – Holdings – CROCI – Growth – ROCE | 4 |
| MAI | Maintel Holdings | 29/6/26 | – Holdings ? Acquisitions – Growth – ROCE | 4 |
| AO. | AO World | 26/6/26 | – CROCI – Growth – ROCE – Shares | 4 |
| PAY | PayPoint | 25/6/26 | – Holdings – Debt – Growth | 3 |
| HLMA | Halma | 24/6/26 | ? Holdings ? Acquisitions | 1 |
| LIO | Liontrust | 24/6/26 | – Growth ? ROCE – Shares | 3 |
| NXR | Norcros | 23/6/26 | – Holdings ? Acquisitions – Debt – Growth ? Shares | 4 |
| OXIG | Oxford Instruments | 23/6/26 | – Holdings – Growth | 2 |
| REC | Record | 23/6/26 | – Holdings – Growth | 2 |
| TRD | Triad Group | 22/6/26 | – CROCI – Growth – ROCE | 3 |
| Click here for our 5 Strikes explainer | 09/07/2026 | |||
After scrutinising their financial histories in a ShareScope custom table, five achieved less than three strikes: Cranswick [? Growth] Halma [? Holdings ? Acquisitions], Oxford Instruments [- Holdings – Growth], Polar Capital [? Holdings – Growth], and Record [- Holdings – Growth].
These companies have joined the research list at the bottom of the page. Understanding the financials is the first step I take to understand a business, and the fewer troublesome numbers there are the easier my job is likely to be.
I prioritise 0’s over 1’s and 1’s over 2’s. Next up is Autotrader, and then Tatton. Both are 0’s.
Autotrader [no strikes]
If you have bought or sold a second hand car you may well have used the ubiquitous online marketplace and former classified advertisement magazine.
As you would expect from a company with a near monopoly of online advertising, Autotrader has a tremendous financial history. Even so, awarding it no strikes this year required some minor mental gymnastics.
Net borrowing of nearly £200m is more than 100% of capital employed, well above my benchmark of 25%. Autotrader’s borrowing (which includes leases) is not high though, capital employed is low.
To put the borrowing in perspective, Autotrader’s borrowings are less than the £370m-odd it spent buying back its own shares during the financial year.
It is also less than the £300m-odd that Autotrader earned in free cash flow in 2026. If that level of cash generation is sustainable, Autotrader could suspend the buyback and pay off the debt within a year.
The debt is a choice. Autotrader believes the shares are cheap and has borrowed money to reduce the number of shares in issue, increasing the value of the remainder. If it is right about valuation, it’s doing shareholders a favour.
The share price is certainly low, but that reflects traders’ uncertainty about the future.
We are turning to AI for answers like what car to buy, and where we can find one cheaply nearby, questions Autotrader has answered for decades. Dealerships, Autotraders’ main source of income, might put less business Autotraders’ way if they can gain more custom from chat bots.
I will be exploring the tug of war between a totemic brand and the data advantage its huge market share gives it, and the possibility its cash flows might be dented by the alternative that AI might offer in more detail on Interactive Investor shortly. Autotrader is one of the companies I routinely consider for its Share Sleuth model portfolio.
Tatton [no strikes]
No mental gymnastics were required to appraise Tatton Asset Management. The company’s founder and chief executive owns nearly 15% of the shares, and some of the other directors own sizable stakes.
Source: ShareScope
And Tatton has performed excellently:
Source: ShareScope. You can find this table and add it to your setup. Go to: Financials > Custom > Settings > 5 Strikes – Richard Beddard
Tatton’s biggest business by far provides Model Portfolio Services (MPS) to Independent Financial Advisers (IFAs) in return for a 0.15% cut of the assets it manages.
The company is similar to a traditional fund manager in that it decides on the investments in its portfolios. It is different because it does not take custody of our money.
The money is invested in funds through investment platforms chosen by the IFAs and their clients. Outsourcing the decisions reduces the cost for IFAs because one team (at Tatton) is making decisions for over 1,200 IFAs.
Tatton reckons over £1 trillion is held on adviser platforms in the UK, of which over £200bn is managed by MPSs and over £20bn is managed by Tatton. The company puts its market share of 22%, making it the biggest MPS in a market that has grown strongly.
Source: Tatton annual report 2026/Platforum
Without putting a timeframe on it, the company believes the market for on platform Discretionary Fund Managers like Tatton will grow from 22% to 40-50% of the overall market in terms of Assets Under Management. Since 2017, the addressable market has grown 410%, while Tatton has very slightly underperformed it (397% growth).
Tatton also has a second, much smaller and less profitable string to its bow in Paradigm. It contributed about 13% of total revenue and 6% of adjusted operating profit before central costs.
Source: Tatton annual report 2026
Paradigm provides mortgages and compliance services to IFAs. It was founded in the same year as Tatton, 2007. The two companies were subsequently merged, and floated on the stockmarket in 2017.
All the 0’s, 1’s and 2’s
So far this year, 71 shares have achieved less than three strikes. I have awarded no strikes to 12 shares, 1 strike to 20 shares, and 39 strikes to 2 shares.
| Name | TIDM | Prev AR | Strikes | # Strikes | Link |
|---|---|---|---|---|---|
| CER | Cerillion | 12/1/26 | 0 | > | |
| HWDN | Howden Joinery | 25/2/26 | ? Holdings | 0 | > |
| PRV | Porvair | 11/3/26 | ? Holdings | 0 | > |
| NICL | Nichols | 23/3/26 | 0 | > | |
| MGNS | Morgan Sindall | 24/3/26 | 0 | > | |
| QTX | Quartix | 25/3/26 | ? ROCE | 0 | > |
| CCC | Computacenter | 8/4/26 | 0 | > | |
| FOUR | 4imprint | 14/4/26 | ? Holdings | 0 | > |
| KEYS | Keystone Law | 13/5/26 | 0 | > | |
| AUTO | Autotrader | 8/6/26 | 0 | ||
| TAM | Tatton | 16/6/26 | 0 | ||
| CWK | Cranswick | 30/6/26 | ? Growth | 0 | |
| BOWL | Hollywood Bowl | 5/1/26 | – Debt | 1 | > |
| MEGP | Me Group International | 23/3/26 | – Growth ? ROCE | 1 | > |
| ALFA | Alfa Financial Software | 24/3/26 | – Growth | 1 | > |
| GAMA | Gamma Communications | 24/3/26 | ? Acquisitions – Holdings | 1 | |
| INCH | Inchcape | 24/3/26 | – Growth | 1 | |
| ROR | Rotork | 27/3/26 | – Holdings ? Growth | 1 | |
| CKN | Clarkson | 30/3/26 | ? Growth – ROCE | 1 | |
| RMV | Rightmove | 30/3/26 | – Holdings | 1 | |
| IMI | IMI | 31/3/26 | ? Holdings – Debt ? Growth | 1 | |
| FDM | FDM Group | 10/4/26 | – Growth | 1 | > |
| HILS | Hill & Smith | 10/4/26 | – Holdings ? Acquisitions | 1 | |
| NXT | Next | 16/4/26 | – Debt | 1 | |
| BAG | Barr (AG) | 21/4/26 | ? Acquisitions ? Growth | 1 | |
| SAG | Science | 21/4/26 | ? Growth | 1 | |
| ELCO | Eleco | 9/5/26 | – Holdings ? Growth | 1 | |
| LSC | London Security | 15/5/26 | – Holdings | 1 | |
| W7L | Warpaint London | 22/5/26 | – Shares ? Growth | 1 | |
| PETS | Pets at Home | 9/6/26 | – Holdings ? Growth | 1 | |
| BMY | Bloomsbury Publishing | 19/6/26 | – Growth | 1 | |
| HLMA | Halma | 24/6/26 | ? Holdings ? Acquisitions | 1 | |
| RWS | RWS | 8/1/26 | ? Acquisitions – Growth – ROCE | 2 | > |
| IHP | IntegraFin | 9/1/26 | – CROCI | 2 | |
| RFX | Ramsdens | 15/1/26 | – CROCI ? Growth ? ROCE | 2 | > |
| REL | RELX | 19/2/26 | ? Holdings – Debt ? Growth | 2 | > |
| IHG | InterContinental Hotels | 26/2/26 | ? Holdings – Debt | 2 | |
| DATA | GlobalData | 2/3/26 | ? Acquisitions – Debt ? ROCE | 2 | > |
| GSK | GSK | 6/3/26 | ? Holdings – Debt ? Growth | 2 | |
| MONY | Mony | 9/3/26 | – Holdings ? Growth | 2 | |
| STEM | SThree | 9/3/26 | – Holdings – Growth | 2 | |
| CTEC | ConvaTec | 10/3/26 | ? holdings – Debt ? Growth ? ROCE | 2 | > |
| BNZL | Bunzl | 17/3/26 | ? Holdings – Debt – Growth | 2 | > |
| HIK | Hikma Pharmaceuticals | 18/3/26 | ? Acquisitions – Debt | 2 | |
| YU. | Yu | 18/3/26 | – CROCI ? ROCE | 2 | |
| JSG | Johnson Service | 19/3/26 | – Holdings – Debt | 2 | |
| ITRK | Intertek | 20/3/26 | ? Holdings – Debt ? Growth | 2 | |
| BA. | BAE Systems | 24/3/26 | ? Holdings ? Acquisitions – Debt ? Growth | 2 | > |
| DOM | Domino’s Pizza | 24/3/26 | – Holdings – Debt ? Growth | 2 | |
| LUCE | Luceco | 25/3/26 | ? Acquisitions – Debt ? Growth ? ROCE | 2 | |
| BBY | Balfour Beatty | 2/4/26 | – Holdings ? CROCI ? Growth – ROCE | 2 | |
| APTD | Aptitude Software | 8/4/26 | – Holdings ? Acquisitions – Growth | 2 | |
| IGG | IG Group | 8/4/26 | – Holdings – Growth | 2 | |
| SPX | Spirax | 8/4/26 | – Holdings – Debt ? Growth | 2 | |
| SVS | Savills | 9/4/26 | – Holdings – CROCI ? Growth ? ROCE | 2 | |
| MACF | Macfarlane | 10/4/26 | – Holdings – Debt ? Growth | 2 | > |
| PAGE | Page | 13/4/26 | – Holdings? CROCI – Debt – Growth – ROCE | 2 | |
| CAML | Central Asia Metals | 15/4/26 | – Growth ? ROCE | 2 | |
| FEVR | Fevertree Drinks | 20/4/26 | – CROCI – Growth | 2 | |
| JDG | Judges Scientific | 22/4/26 | ? Acquisitions – Debt – Growth | 2 | > |
| WINK | M Winkworth | 24/4/26 | – Holdings – Growth | 2 | |
| EKF | EKF Diagnostics | 27/4/26 | ? CROCI – Growth ? ROCE | 2 | |
| IOF | Iofina | 1/5/26 | ? CROCI – ROCE ? Shares | 2 | |
| AEO | Aeorema Communications | 18/5/26 | – CROCI ? Growth ? ROCE | 2 | |
| ASY | Andrews Sykes | 18/5/26 | – Holdings – Growth | 2 | |
| CARD | Card Factory | 21/5/26 | – Holdings – Debt | 2 | |
| ANP | Anpario | 1/6/26 | ? CROCI – Growth ? ROCE | 2 | > |
| QQ. | QinetiQ | 10/6/26 | ? Holdings ? Acquisitions ? Growth – ROCE | 2 | |
| OXIG | Oxford Instruments | 23/6/26 | – Holdings – Growth | 2 | > |
| REC | Record | 23/6/26 | – Holdings – Growth | 2 | |
| POLR | Polar Capital | 3/7/26 | ? Holdings – Growth | 2 | |
| Click here for our 5 Strikes explainer | 09/07/2026 | ||||
Richard Beddard
Contact Richard Beddard by email: richard@beddard.net, web: beddard.net
This article is for educational purposes only. It is not a recommendation to buy or sell shares or other investments. Do your own research before buying or selling any investment or seek professional financial advice.
