Here's a stock with great momentum

Equity markets look poorly this week, toppled by fears that Donald Trump might actually beat Hillary Clinton to the White House next Tuesday. Caution is understandable, but some companies are able to shrug off macro events, underpinned instead by overwhelming stock, or industry specific drivers.

Just look at the number of companies making new one-year highs. According to investment data service SharePad, eight FTSE All-Share stocks did on Wednesday, among them Anglo American, UK Mail and Consort Medical. Include investment trusts and secondary listings and it's over 100!

Of those, £220 million mining royalties firm Anglo Pacific has just hit a two-year high following decent third-quarter results.

Royalty income soared to £4.7 million, in line with forecasts, but up from £1.9 million a year ago and more than double the number in the previous quarter. That's because of higher volumes at its main producing royalty, the Kestrel coal mine operated by Rio Tinto, and a 20% slump in the value of sterling versus the Aussie dollar this year.

"Encouragingly, we believe that more good news is still to come in the fourth quarter of 2016, when increased coal prices and mining in our royalty areas should benefit the company still further," says chief executive Julian Treger.

"With the outlook for robust coal prices set to continue through the first half of 2017, we look forward to the corresponding benefit to our dividend cover. We remain very excited about the group's prospects, as Anglo Pacific continues to be one of the only listed royalty companies that provides such high levels of exposure to coking coal price increases."

Anglo shares have risen steadily since March when they bottomed out at around 50p. But Interactive Investor writer Edmond Jackson backed them in September at 110p.

Alexander Pearce, an analyst at BMO Capital, has not made any significant changes to his outlook for 2016 and 2017 adjusted earnings of 7p and 11p a share respectively.

"Our forecast of 2H16 earnings of 6p/share fully cover the semi-annual divided 3p/share) for the first time since 2013," he says.

"The company's attractive >4x earnings and cash flow growth over two years, combined with a fully-covered dividend, is expected to drive continued share price appreciation. As such, we continue to rate the company 'outperform' with a 130p/share target price."

That target represents a forward dividend yield of 4.6% for 2017 and 5.4% the year after, and a price/net present value (NPV) of 1.7 times.

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.