| Buy | |||
|---|---|---|---|
| Company | Publication | Reason | Price tipped |
|
Adv. Comp. Software (ASW) Software |
The Times | This IT and software services firm could benefit as the NHS looks to cut costs and outsource. Chief executive Vin Murria has an excellent track record. It’s a speculative buy. | 58p/36p* 52p |
|
Babcock (BAB) Commercial services |
Shares | This support services firm is set for 8% organic growth this year, driven by the Ministry of Defence’s trend towards outsourcing. The price/earnings (p/e) ratio of 12.7 is undemanding. | 894p/560p 872p |
|
BHP Billiton (BLT) Mining |
The Sunday Telegraph | Oversupply issues could see this miner scale back its spending and return money to shareholders. The shares are cheap on a June 2012 p/e of 8.2. | 2,531p/1,625p 1,800p |
|
Cairn Energy (CNE) Oil and gas |
The Times | A £414m deal to buy Nautical Petroleum gives Cairn 25% of the North Sea Catcher and 30% of the Kraken fields, set to come on stream at the end of 2015. It’s a long-term gamble. | 475p/262p 289p |
|
Consort Medical (CSRT) Healthcare products |
Investors Chronicle | The healthcare firm’s core inhaler business grew revenues 12% and the long integration of King Systems is almost complete. A 9% drop since May is an opportunity to buy on a p/e of 11. | 675p/490p 605p |
|
Cupid (CUP) Internet |
Investors Chronicle | A strong first half saw the online dating specialist make rapid growth in new markets, such as America and Europe. Social and mobile developments are interesting too. It’s on a p/e of 13.7. | 260p/168p 203p |
|
Falkland Island Hold. (FKL) Commercial services |
The Daily Telegraph | With 50 acres of land in the Falklands and plans to invest £10m in local infrastructure, this diversified firm offers a play on the region’s oil boom. The yield is 3.4%. | 418p/225p 345p |
|
Galileo Resources (GLR) Mining |
Investors Chronicle | The rare earth miner has an estimated 267,000 tonnes of resources at its Glenover mine and should benefit from a shortage of the materials used in products from iPods to missiles. Buy. | 53p/32p 41p |
|
Hyder Consulting (HYC) Commercial services |
The Times | The engineering consultancy is focusing its business in higher growth areas, including China and the Middle East, and has net cash of £15.6m and a strong order book. Buy and be patient. | 448p/305p 398p |
|
IDOX (IDOX) Aim |
Shares | From a base in local British government (90% of councils are clients), this software firm is expanding into commercial markets. The dividend should rise 33% this year. | 40p/21p 37p |
|
IGas Energy (IGAS) Energy alternate |
Investors Chronicle | This energy firm has proved the presence of shale at its Bowland prospect in Cheshire. Confirmation of hydrocarbons would bring plenty of upside. | 73p/42p 66p |
|
Johnson Matthey (JMAT) Chemicals |
Investors Chronicle | The market for this group’s heavy duty diesel catalyst to make vehicles ‘greener’ should be worth $2.5bn by 2015; it aims to take a 60% share. A p/e of just over 14 isn’t expensive. | 2,426p/1,484p 2,267p |
|
J Sainsbury (SBRY) Food |
The Daily Telegraph | The share price fall on slightly weaker-than-expected sales is overplayed, and this grocer remains a buy for the yield of 5.8%. Buy on a March 2013 p/e of 9.7. | 336p/258p 284p |
|
Majestic Wine (MJW) Aim |
Shares | This wine specialist plans to add 16 new sites a year and is making progress in e-commerce and corporate sales. It’s on a 2013 forecast yield of 4%, covered 1.6 times by earnings. | 510p/312p 417p |
|
Renew (RNWH) Engineering and construction |
This is Money | This maintenance firm has niche engineering skills in sectors from nuclear to transport and should benefit from the trend to cut capital spending and look after existing infrastructure. | 84p/49p 75p |
|
RPC Group (RPC) Packaging/containers |
This is Money | The purchase of rival Superfos helped this plastics firm report a 68% increase in underlying profits to March 2012 and a 25% dividend hike. There should be more to come. | 399p/288p 380p |
|
Stanley Gibbons (SGI) Aim |
Shares | Fast online growth (sales have doubled in 2012), international expansion and the Diamond Jubilee could boost this rare collectibles retailer ahead of 10 August interims. | 237p/164p 212p |
|
WH Smith (SMWH) Retail |
The Daily Telegraph | A 12% fall in this newsagent’s share price since the start of April is overdone as margins are improving. The shares are now too cheap compared to rivals on an August 2012 p/e of eight. | 568p/437p 485p |
|
WS Atkins (ATK) Commercial services |
The Daily Telegraph | The engineering consultancy aims to reduce its UK exposure to 25% from 49% and should benefit from increased work in growth areas such as the Middle East. It’s on a p/e of 8.7. | 806p/481p 697p |
|
WYG (WYG) Aim |
Shares | After a £5.8m loss to March 2012, this infrastructure consultant is expected to return to profit in 2013. It’s a speculative buy as an improved credit rating will open access to new contracts. | 450p/43p 46p |
|
Zytronic (ZYT) Aim |
Shares | This display maker’s touch-screen technology is boosting sales, including deals with Coca-Cola and London’s ‘Boris Bike’ scheme. There’s also further growth potential in Asia. | 325p/184p 310p |
| Sell | |||
| Company | Publication | Reason | Price tipped |
|
Lloyds Banking Group (LLOY) Banks |
Investors Chronicle | The bank has £23bn worth of exposure to the five weakest eurozone nations, with Irish bad debt charges at £3.2bn at the end of 2011. The shares look vulnerable and there’s no dividend. | 51p/22p 28p |
|
Nokia (FI: NOK1V) Telecommunications |
Investors Chronicle | The Finnish phone maker is cutting 10,000 more jobs and there is little cause for optimism as sales of its Lumia smartphone have been disappointing. The shares have further to fall. | €5.20/€1.80 €1.90 |
|
Ocado (OCDO) Food |
Shares | This online retailer is losing market share to rivals looking to expand online. The prospective p/e of 25 looks high; more downside is possible when half-year figures are reported. | 212p/52p 99p |
|
Premier Foods (PFD) Food |
Shares | The Bisto, Hovis and Mr Kipling owner is facing a £1.2bn debt pile at the end of the year, a large pension deficit and a challenging grocery market. Sell ahead of 7 August interims. | 271p/30p 80p |
|
PZ Cussons (PZC) Cosmetics/personal care |
Investors Chronicle | A 15% drop in underlying pre-tax profits was better than expected for this personal care products firm. But the forecast p/e of 26 doesn’t reflect the risk of input cost uncertainty. | 387p/285p 340p |
| * 52-week high/low | |||