| Buy | |||
|---|---|---|---|
| Company | Publication | Reason | Price tipped |
|
Aviva (AV) Insurance |
The Sunday Telegraph | Poor performance has seen CEO Andrew Moss step down, but the fundamentals for this insurance giant seem solid. The shares, down 60% since July 2007, now look undervalued. | 448p/251p* 273p |
|
Barratt Developments (BDEV)
Home builders |
Investors Chronicle | The house builder posted its best spring selling season for five years but is still cheap at a 34% discount to net tangible assets. As prices and margins improve, the shares should catch up. | 153p/65p 134p |
|
Brammer (BRAM)
Distribution/wholesale |
Investors Chronicle | The Europe-focused industrial parts distributor has fallen on eurozone woes but could bounce if further cheap credit flows as a result. A rise to April’s 384p high would mean 51% profits. | 384p/215p 253p |
|
Chariot Oil & Gas (CHAR)
Aim |
Shares | A 36% fall since 14 May is a chance to buy this oil explorer ahead of drilling at its Nimrod well. It is targeting 4.9 billion barrels, potentially worth £14.39 per share. It’s a risky buy. | 208p/67p 95p |
|
Cohort (CHRT) Aerospace/defence |
The Times | The military tech and advisory firm has a £14m cash pile to increase shareholder value. On a price/earnings (p/e) ratio of under eight, the shares look worth buying for the longer term. | 125p/87p 108p |
|
Cluff Gold (CLF)
Aim |
Shares | Positive drill results for this £110m market cap gold miner’s Ivory Coast Yaoure project bode well for resource upgrades later this year, which should boost the share price. Buy. | 115p/62p 66p |
|
Daisy Group (DAY) Telecommunications |
Shares | The B2B telecoms firm has £60m to pick up unwanted assets from Vodafone’s purchase of Cable & Wireless, which could boost its growth profile. This isn’t reflected in a 2013 p/e of 6.2. | 130p/82p 88p |
|
Dart Group (DTG)
Aim |
Investors Chronicle | Despite tough conditions, the airline and package holiday provider has grown passenger numbers and bookings are encouraging. A drop in oil prices should also help. The p/e is five. | 95p/57p 69p |
|
Gem Diamonds (GEMD) Mining |
Shares | The diamond miner fell 35% in the three months to 22 June, but the stock looks to have bottomed out. This offers a chance to get in on the long-term diamond demand story. | 317p/173p 194p |
|
Kier Group (KIE) Engineering/construction |
The Times | The engineer has £140m in the bank and has secured 85% of 2013’s forecast revenues, with more contracts up for grabs. The shares, on a p/e of just over eight, may be due a bounce. | 1,489p/1,034p 1,225p |
|
Micro Focus Int’l (MCRO) Software |
Investors Chronicle | The computer systems specialist is raising its dividend distribution ratio from 40% to 50% and could return 37% of its market value over the next few years. Buy on a forecast p/e of ten. | 544p/230p 514p |
|
MP Evans (MPE)
Aim |
Shares | This palm oil and cattle firm is benefiting from a 93% year-on-year increase in oil-palm crops and strong prices held up by demand in India and China. Buy on a December 2012 p/e of 13.3. | 525p/370p 479p |
|
Norcros (NXR)
Building materials |
Investors Chronicle | The tiles, shower and adhesive supplier has stolen business from European rivals and won useful work with Waitrose and the Olympic Village. A forward p/e of six looks too cheap. | 15p/9.25p 12p |
|
Quindell Portfolio (QPP)
Aim |
Shares | The integrated insurance software firm’s money-saving model has won work with Ageas and RSA and it is bidding for £500m of further business. A 2012 p/e of 5.6 looks a good entry point. | 8.5p/2p 5.5p |
|
RSA Insurance (RSA) Insurance |
Shares | The insurer avoided big losses last year and is benefiting from rising premiums and greater volumes. With the business enjoying an uptick, buy ahead of 2 August interims. | 140p/97p 104p |
|
Sage (SGE) Software |
Shares | The purchase of a 75% stake in Brazilian peer Folhamatic opens up a major new arena and could make this accountancy software firm a takeover target. It’s attractive on a p/e of 12.4. | 313p/225p 266p |
|
Segro (SGRO) REITS |
The Times | The property owner is selling £1.4bn of less attractive assets and has rearranged its £2.3bn debt pile. Management has promised to protect the yield of close to 7%. Buy and wait. | 322p/194p 216p |
|
Stagecoach (SGC) Transportation |
The Daily Telegraph | Despite a 44% fall in operating profit at its UK rail division, this bus and train operator is riding out the recession well. London, regional and US bus services look strong. Buy on a p/e of ten. | 291p/207p 264p |
|
Unibail-Rodamco (FR:UL) REITS |
Investors Chronicle | The French property investor’s low borrowing (3.6%) and administration costs have helped make it Europe’s top performing REIT. Buy on a 2% premium to net asset value. | €163/€123 €140 |
|
Victoria (VCP)
Textiles |
Investors Chronicle | Shares in the carpet firm fell on poor Australian sales in the half-year results. But a tie-up with John Lewis helped raise British sales 15.4% and the shares trade well below net asset value. | 385p/213p 225p |
|
Wynnstay (WYN)
Aim |
Investors Chronicle | The animal feed producer has successfully integrated a number of acquisitions and a move into east England should bring further gains. A forecast p/e of 11 looks modest. Buy. | 408p/328p 385p |
| Sell | |||
| Company | Publication | Reason | Price tipped |
|
Barclays (BARC)
Banks |
The Independent | While the bank’s shares look cheap at 50% of estimated book value, the furore around the £290m Libor fix will keep pressure on the stock. Financially – and ethically – it’s a sell. | 266p/134p 166p |
|
Carpetright (CPR) Retail |
The Daily Telegraph | This carpet seller’s annual profits dropped 76% to £4m – the lowest level since 1992. What’s more, the shares are “as expensive as a Persian rug” on a forward p/e of 72 and no dividend. | 753p/375p 686p |
|
Idox (IDOX)
Aim |
This is Money | The software firm raised half-year profits 54% and the shares are up almost 400% since April 2008. Shareholders should bank 50%-65% profits; new investors could buy on weakness. | 41p/21p 40p |
|
Ladbrokes (LAD)
Entertainment |
The Daily Telegraph | Delays to this bookie’s new website will contribute to a now expected 50% fall in half-year digital profits, leaving an online gap with larger rival William Hill. Avoid on a p/e of ten. | 183p/113p 152p |
|
Wm Morrison (MRW)
Food |
The Daily Telegraph | The supermarket is losing market share and will lose highly respected financial director Richard Pennycook next year. A yield of 4.1% is less than rivals on a p/e of ten. Sell. | 340p/261p 265p |
| * 52-week high/low | |||