July 2026 - Breakouts

#UKSTOCKS #IOF #CFX #MWE #WRKS #DIAL

Introduction

Breakouts for this month!

This screen is run 12 times a year at the beginning of each month, thus providing a monthly view.

If you have not yet seen the full list of screens or the 2026 schedule, here is a link to that original article, which contains the target dates for each screen.

The Breakout Screen

Screen Overview

This screen is available in the Sharescope Filter Library, in fact, in this situation, there are two of them, they’re titled…

• Briefed Up - M01 - Breakouts - 12m

• Briefed Up - M01 - Breakouts - 3m

The reason for two screens in this situation is simply to make the process easy for you to switch between 12 month and 3 month breakouts. In a more bullish environment the 12 month breakout is perhaps more appropriate, to identify the strongest stocks. In a more bearish environment the 3 month breakout would perhaps be more appropriate, to identify stocks which may be leading a recovery.

For those of you needing any orientation with filters, this Sharescope article is very useful, as it also includes details on how to access the library and these filters.

Do remember, for additional help and support, all Sharescope subscribers can book free training sessions here.

Objective

• Identify stocks that have broken above the high of the 12 month range prior to this month and are still holding that high now (Briefed Up - M01 - Breakouts - 12m), or

• Identify stocks that have broken above the high of the 3 month range prior to this month and are still holding that high now (Briefed Up - M01 - Breakouts - 3m)

Parameters

Stock Universe Settings

• Market Cap: Default - £10m to No limit - To exclude small illiquid stocks

• Sectors: Default - Exclude “Tobacco”, “Industrial Metals and Mining”, “Precious Metals and Mining”, and “Oil, Gas and Coal” - To exclude sectors I don’t typically invest in

• ISIN Country of Register: Default - Exclude “JP” and “FR” - To exclude these specific foreign registered stocks

Note: My default stock list is always “LSE shares (excluding Investment Trusts (ITs))”.

Base Settings

• For “Briefed Up - M01 - Breakouts - 12m” - Price is higher than the high of the 12 month range prior to this month

• For “Briefed Up - M01 - Breakouts - 3m” - Price is higher than the high of the 3 month range prior to this month

Optional Settings

• Forecast EPS (for next year) is greater than 0 - Forecast to make a profit next year

• Forecast EPS (for next year) upgrade percentage (in the past 3 months) is greater than 0 - Brokers have upgraded next years earnings forecasts in the past 3 months

Settings Used

I have decided to go with consistency again this month and stick with the “Briefed Up - M01 - Breakouts - 12m” filter.

Stock Universe Settings

• No change to defaults

Base Settings

• No change to defaults

Optional Settings

• Forecast EPS (for next year) is greater than 0 - Checked and set to 0

• Forecast EPS (for next year) upgrade percentage (in the past 3 months) is greater than 0 - Checked and set to 0

Actual Settings

Results

The screen returned 42 stocks. And, this month I have decided to take 5 of the bottom 6, the ones with the lowest market cap that I have not covered this year.

I covered TPX last month, in UK Stock Upgrades - June 2026 here.

I will focus on IOF, CFX, MWE, WRKS, and DIAL.

“Our View”

As usual, Paul has kindly allowed me to provide the current view from the Small/Mid Caps with Paul Scott Substack database for the 5 stocks I am covering this month, so here they are…

Members of the Small/Mid Caps with Paul Scott Substack can click here to access details and commentary for the vast majority of all of the stocks from the above results. The full history for most UK stocks is available via the the new Small/Mid Caps Value Report Search App, which covers over 18 months of updates in some cases.

For example, here are the last five (of seven) Small/Mid Caps Value Report Search App entries for CFX…

Members of the Small/Mid Caps with Paul Scott Substack get:

• Access to the complete history, and current view, of over 800 UK stocks via the Small/Mid Caps Value Report Search App

• Main section articles on over 250 of those UK stocks

• Morning RNS announcement analysis, out before the market open

• Daily analysis of up to 30 stocks a day, even more on very busy news days

• Exclusive interviews

• Up to 5 podcasts a week. and a weekly update video

• Access to an active and growing community of UK investors, where participation is encouraged

• A team (which includes me) with almost 100 years of joint investing experience, focused on delivering the best coverage of the UK stock market

In Focus

Iofina (IOF) - Specialist producer of iodine and specialty chemical products (second largest iodine producer in the US). Up almost 100% this year, the forward PER of 17.4x (for FY 12/26) looks quite racey, but that is forecast to fall to just 10.3x in FY 12/27 (and if you look out to FY 12/28, <7x). This looks quite interesting! The second largest producer of iodine in the US, demand mostly medical driven, but is new stronger demand now incoming, from zinc-iodine batteries, for example? I don’t know much about iodine or the industry it supports but from a pure numbers perspective, this actually looks worth a punt, although I don’t think I could ever commit in size, due to my limited knowledge of the niche.

Note: iodine spot prices are also driving earnings, and the new capacity due to come on-line soon is also a tailwind for those forward earnings forecasts.

Colefax (CFX) - Interior design group: Luxury fabrics, wallpapers, and traditional home furnishings, and an interior decorating business. Up 50% this year (with revenue and earnings helped by a USD FX tailwind) but still looks reasonable value to me on a forward PER of 10x. Although there is little in the form of a regular dividend here, in the last 3 years, via tenders and buybacks, the company has reduced the share count by 25%+. I am a little concerned that FY 4/27 earnings are forecast to fall by 10%+, with FY 4/28 set to recover, but not to be greater than the 137p forecast for FY 4/26. This could of course change if that net cash is put to use again, as it currently stands at over 30% of the market cap.

MTI Wireless Edge (MWE) - Israel-based technology group: Mainly communication and radio frequency solutions (antennas) across multiple sectors (mostly defense). Up over 50% year-to-date, on a c.3.5% yield, the mid-teen PER now looks to me to be up with events. Earnings are forecast to grow just 10% from 5.8c in FY 12/25 (actual) to 6.4c in FY 12/28 (forecast), USD. Perhaps the market is factoring in increased business due to the current geo-political climate?

The Works (WRKS) - Leading UK&I discount retailer (500+ stores): Books, arts, crafts, toys, and stationery for value-conscious customers. Doesn’t look expensive on a forward PER of 7-8x. Margins, as expected, are not great, but the new CEO Gavin Peck is targeting 6%+ (in the medium-term). Not sure WRKS will ever command a double-digit rating again but if it does, and meets those margin targets, it looks like there is upside here, even after doubling year-to-date.

Diales (DIAL) - Global consultancy: Provides legal project dispute resolution and advisory services to the construction industry. On a forward PER of 16x and a 4.7% yield, looks fairly priced to me given the earnings growth forecasts. I wonder if the market is perhaps pricing in a tick-up in business as many disputes arise from the conflict in the Middle East?

Summary

The Small/Mid Caps with Paul Scott Substack

If you are not already a subscriber to the Small/Mid Caps with Paul Scott Substack and are interested in a 1 week FREE trial, click here to access all of the features mentioned above.

Sharescope

If you are not already a subscriber to the excellent Sharescope software we use every day over at the Small/Mid Caps with Paul Scott Substack, click here for the Small/Mid Caps with Paul Scott Substack deal and get:

• A discount to the annual subscription fee

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Thank You

If you have any suggestions for improvement, or any feedback at all, do please leave a comment.

Thanks for reading, and see you in the next one!

IMPORTANT NOTE: It is vital that you check all figures in this article for yourself, as they may be inaccurate or may have changed since publication.

MORE IMPORTANTLY: No investment advice intended, for information only, I may hold all, some, none, of the stocks mentioned in this article - Do Your Own Research!

Jon