| Buy | |||
|---|---|---|---|
| Company | Publication | Reason | Price tipped |
|
Archipelago Resources (AR)
Aim |
Shares | Positive drilling results last week (9 July) at this gold miner’s Toka Tindung deposit in Indonesia bode well for resource upgrades and a potential share-price uplift. Buy now. | 80p/48p* 50p |
|
Aviva (AV) Insurance |
Shares | Investors should benefit from the insurer’s plans to sell off non-core businesses. This should help sustain the 8.3% forward yield. A 28% discount to net asset value (NAV) is attractive. | 442p/251p 288p |
|
Bloomsbury Publishing (BMY) Media |
The Sunday Telegraph | The publisher is benefiting from fast-growing e-sales and higher-margin academic books. A February 2013 price/earnings (p/e) ratio of 9.5 looks undemanding. Buy on a 4.7% yield. | 130p/90p 117p |
|
Britvic (BVIC) Beverages |
The Daily Telegraph | A 15% drop on a product recall for the soft drinks group could cost up to £25m, but offers a buying window for investors. It’s a recovery play on a p/e of 9.1; the yield is 6.5%. | 403p/250p 261p |
|
Carr’s Milling Indust (CRM) Agriculture |
Investors Chronicle | Strong performances in engineering and agriculture have helped this agriculture group beat forecasts for the 18 weeks to 7 July. The shares are a buy on a p/e of nine. | 910p/700p 872p |
|
Catlin Group (CGL) Insurance |
Shares | The Lloyd’s of London insurer is benefiting from rate increases, but the shares have yet to catch up. Buy ahead of 6 August interims as a positive second quarter may prompt a re-rating. | 452p/331p 423p |
|
Deere & Co (NYSE:DE) Machinery diversified |
Investors Chronicle | Growth in global food production and a trend towards farm mechanisation in emerging markets should benefit the world’s leading agricultural machinery maker. Buy on weakness. | $90/$60 $81 |
|
Eros International (EROS) Entertainment |
Investors Chronicle | The Indian-language filmmaker’s shares have fallen to a 12-month low on uncertainty over a move to a US listing. But there is a stong pipeline of releases and a p/e of seven looks too low. | 310p/173p 182p |
|
Fenner (FENR) Misc. manufacturing |
The Times | A recent 30p fall on low gas/coal prices and demand looks overdone. Down 29% since early March, the conveyor belt maker looks good value on a p/e of under ten. | 505p/270p 345p |
|
Melrose Resources (MRS) Oil and gas |
The Times | The oil explorer has upped estimates for probable reserves at its Nile Delta asset by nearly 30%. The shares, down from £3 last May, look almost cheap. It’s one for the very brave. | 209p/89p 124p |
|
Micro Focus (MCRO) Software |
Shares | New products could help drive topline growth in this software firm, while an estimated £76.3m in free cash flow looks likely to be used for share buybacks and bonus payouts. Buy. | 554p/230p 541p |
|
Prim Health Properties (PHP) REITS |
The Daily Telegraph | A successful £75m bond offering should boost this medical property owner’s firepower. Despite a p/e of 23 (reflecting clear earnings), the shares are an income play on a yield of 5.8%. | 350p/273p 317p |
|
Quindell Portfolio (QPP) Aim |
The Daily Telegraph | Lean conditions for the British motor insurance industry should boost this insurance outsourcing group. It’s a growth play and the shares look cheap on a 2012 p/e of 6.3. | 8.5p/2p 5.5p |
|
RM (RM) Software |
The Times | Led by experienced turnaround specialist Martyn Ratcliffe, this educational software firm has cut staff numbers by 17% and shed non-core business to focus on three new products. | 149p/40p 76p |
|
Rolls-Royce (RR) Aerospace/defence |
The Daily Telegraph | A growing civil airline market with expected demand of £518bn over the next 20 years will benefit this engine maker and boost service revenues, which rose to £6bn in 2011. | 894p/519p 862p |
|
Rubicon Div Invest (RUBI) Investment companies |
Investors Chronicle | The holding firm is launching sub-Saharan Africa’s first low-cost airline, FastJet, which should benefit from the region’s population boom and growing economy. It’s a speculative buy. | 8.5p/0.5p 3.75p |
|
Telit Communications (TCM)
Aim |
Shares | The machine-to-machine (m2m) telecoms firm’s Air product line is in trial with 80 potential clients and could open up a massive market in aviation. Buy on a 2013 p/e of 8.6. | 92p/44p 55p |
|
Topps Tiles (TPT) Retail |
Investors Chronicle | Earnings per share (EPS) has fallen from 15p in 2007 to today’s 5p, but this tile specialist is now on the road to recovery and is looking to expand its shops. Buy on a p/e of seven. | 57p/22p 41p |
|
Tribal Group (TRB) Commercial services |
Shares | A string of deals, including a $40m contract in Australia and a link-up with the US army, bode well for this education technology specialist. Buy ahead of August half-year results. | 94p/40p 88p |
|
Vp (VP) Commercial services |
Investors Chronicle | A £4m deal to buy some of Balfour Beatty’s safety training and survey business looks savvy and this plant-hire firm is cheap compared to rivals on a prospective p/e of 9.2 and yield of 4%. | 304p/191p 296p |
|
William Sinclair (SNCL) Aim |
Shares | This garden products firm has warned full-year profits to September will fall short as wet weather has affected sales and harvests. Use the dip to buy, as this looks to be an aberration. | 196p/143p 155p |
| Sell | |||
| Company | Publication | Reason | Price tipped |
|
Ashmore Group (ASHM) Div. financial services |
The Times | Depressed emerging markets have hit this fund manager after 2011’s purchase of EM stocks specialist EMM. In the second quarter, the fund lost £1 in every £5 invested in equities. Avoid. | 430p/300p 308p |
|
Debenhams (DEB) Retail |
Shares | The department store chain has done well: the shares are up 57% since the start of the year. But the wet weather has affected early summer trade. Take profits ahead of October finals. | 90p/50p 89p |
|
JJB Sports (JJB) Retail |
The Daily Telegraph | The sportswear retailer is facing competition from rival Sports Direct and a poor consumer backdrop. Rising debt means the shares should be avoided despite a recent 26% fall. | 25p/4.5p 7.5p |
|
Lonmin (LMI) Mining |
Investors Chronicle | A 10% fall in prices and an 11% rise in operating costs has hit the platinum miner’s profit margins. With an expected platinum surplus in 2012, the shares could come under pressure. | 1,347p/680p 701p |
|
Marks & Spencer (MKS) Retail |
The Independent | This retailer has been hit by poor clothes sales (down 6.8% in the 13 weeks to end June) and risks losing customers to rivals. The 5.5% yield on a p/e of ten isn’t cheap enough. Avoid. | 390p/296p 312p |
| * 52-week high/low | |||