| Buy | |||
|---|---|---|---|
| Company | Publication | Reason | Price tipped |
|
4imprint Group (FOUR)
Commercial services |
Investors Chronicle | The £24m sale of Brand Addition has helped the promotional products firm boost its business in the $22bn North American market. A p/e ratio of 13 looks good value. | 313p/200p 281p |
|
BSkyB (BSY)
Media |
Investors Chronicle | News Corp’s woes and the rising price of English football rights have dogged the broad-caster’s shares. But it has strong cash flows and is a defensive growth play on a p/e of 13. | 775p/614p 720p |
|
DDD Group (DDD) Aim |
Shares | The 3D conversion specialist should benefit from the growth in products using 3D functions. Broker Canaccord Genuity thinks the shares could double inside 12 months. | 35p/21p 27p |
|
Diageo (DGE)
Beverages |
Shares | Strong sales momentum and acquisitions in fast-growing Brazil, Turkey and Vietnam should boost this drinks giant ahead of 23 August finals. A punchy p/e of 17 is well deserved. | 1,760p/1,082p 1,737p |
|
Drax (DRX) Holding companies div. |
The Times | Clarification over subsidies for this firm to convert its coal-fired plant to biomass should have boosted the shares. They are down 8% from before the announcement. A risky punt. | 589p/390p 475p |
|
Elementis (ELM) Chemicals |
The Times | High margins mean this chemicals specialist should have $50m or more in cash by the end of the year, half of which will be returned to shareholders. A long-term buy on a p/e of 14. | 215p/105p 210p |
|
Fiberweb (FWEB)
Apparel |
The Times | The materials specialist is benefiting from a move to higher-margin areas, and could have £25m cash by year’s end to invest, or return to shareholders. Tuck away on a p/e of 13. | 72p/39p 70p |
|
GKN (GKN) Auto parts & equipment |
The Daily Telegraph | The engineer is exposed to long-term growth in automotive (global vehicle numbers are set to rise 22% by 2017), aerospace and agriculture markets. Buy on a p/e of 8.5 and a yield of 3.4%. | 237p/153p 211p |
|
Halfords (HFD)
Retail |
Shares | The retailer saw a 7.5% like-for-like sales decline in the first quarter, but should benefit from a new CEO and investment in auto maintenance. A recovery play on a March 2013 p/e of 8.3. | 352p/187p 204p |
|
Ideagen (IDEA) Aim |
Shares | The software firm is benefiting from higher levels of red tape in regulation-heavy industries such as defence and food. The shares could top 25p within a year. Buy on a p/e of ten. | 17p/9p 16p |
|
Inchcape (INCH) Distribution/wholesale |
The Daily Telegraph | Despite fears of slowing emerging markets, the long-term growth trend of vehicle sales in Asia should boost the luxury car dealership. A p/e of 10 is not expensive; the yield is 3.3%. | 427p/261p 379p |
|
Judges Scientific (JDG)
Electronics |
The Mail on Sunday | Despite soaring 74% since November, the scientific instruments specialist still looks relatively cheap compared to rivals. Expect a 21% rise in profits this year. Buy on weakness. | 765p/393p 745p |
|
NewRiver Retail (NRR)
REITS |
Investors Chronicle | Shares in the high-street mini-malls shop owner have dropped since floating in 2009 and now look a bargain at a 31% discount to net asset value, and offering a yield of 8.9%. | 250p/177p 182p |
|
Novae Group (NVA)
Insurance |
Investors Chronicle | A 12% discount to brokers’ estimates for year-end net tangible assets looks too cheap as the Lloyd’s insurer returned a solid half-year combined ratio of 93% and return on equity of 14.5%. | 381p/281p 364p |
|
Petra Diamonds (PDL)
Mining |
The Daily Telegraph | Despite price pressures, the diamond miner’s full-year production rose by 98% to 2.2 million carats and revenues rose 44%. The shares are up 8% since January; the 2013 p/e is ten. | 189p/93p 120p |
|
Provexis (PXS) Food |
The Mail on Sunday | The sports nutrition and health food firm’s products are used by Olympic athletes and its blood-clot-reducing Fruitflow has huge potential. Get in early as profits start to flow. | 3p/1.25p 1.5p |
|
Renold (RNO) Machinery diversified |
The Times | A 22% share price fall on a profit warning should be seen as a temporary blip for this chain-and-transmission gear maker as the long-term prospects look solid. A speculative buy. | 41p/21p 23p |
|
Tower Resources (TRP) Aim |
Shares | The oil explorer’s 30% stake in offshore Namibian assets owned with Spain’s Repsol could benefit from good news from Chariot Oil & Gas and BP in a nearby block due next month. Buy. | 5.25p/2.25p 3.25p |
|
TT electronics (TTG) Electronics |
The Times | The electronics maker has cut away non-core business, reduced costs and upped exposure to fast-growing China and India. A fall from above £2 in March is a chance to buy on a p/e of nine. | 205p/117p 153p |
|
Xaar (XAR)
Computers |
Shares | Interims set for 16 August should allay worries over this printing tech manufacturer’s P3 product line and could lead to forecast upgrades and a return to March highs of 275p. Buy. | 280p/185p 228p |
| Sell | |||
| Company | Publication | Reason | Price tipped |
|
HMV (HMV) Retail |
Shares | The troubled high street retailer’s earnings targets have been hit by drab weather and poor consumer sentiment. Sell ahead of September’s AGM as there is potential for more bad news. | 7.5p/2.25p 3.5p |
|
Int’l Con. Airlines (IAG)
Airlines |
Investors Chronicle | Spain’s debt crisis and competition from low-cost carriers saw this airline group’s Iberia subsidiary record a £209m operating loss for the half year. Sell as Spain’s plight is set to continue. | 203p/131p 151p |
|
Latchways (LTC) Building materials |
Investors Chronicle | Slowing sales in the US (10% of sales) and exposure to the eurozone (33% of sales) will hit the safety harness firm’s margins. A p/e of 14 looks high given the construction downturn. Sell. | 1,190p/935p 970p |
|
Reckitt Benckiser (RB) Household products |
The Daily Telegraph | Despite plans to up emerging-market sales from 42% to 50% over five years, the group is still overly exposed to the difficult US and European markets. Sell on a 2012 p/e of 14.4. | 3,688p/2,960p 3,536p |
|
Yule Catto (YULC) Chemicals |
Shares | Weakness in Europe and North America has seen this chemicals firm fall 43% since March. Sell ahead of 28 August interims as price pressures and poor demand in Asia look set to stay. | 257p/126p 143p |
| * 52-week high/low | |||