Newspaper and magazine share tips
Each week we round up share tips from national newspapers and investment magazines. For the Mail on Sunday's stock picks, read the Midas column.
New year blues: Can Thomas Cook's shares weather the storm.
FRIDAY
The Times
Balfour Beatty might be expected to show interest in developing this country's next-generation of pressurised reactors. In the interim, Balfour has a £12bn order book, £200m of cash, and should benefit from last week's measures by the Chancellor to bring forward £3bn of public sector work. At less than seven times next year's earnings, and yielding 4.5%, the shares remain a solid hold.
Optos, the British medical technology developer, draws 90% of its sales from America. The attraction of Optos in tougher times is that, rather than selling its machines to doctors, it charges them on a pay-per-view basis under a three-year contract. Optos, at 73p, is well worth a flutter. Buy.
The Daily Telegraph
The defence and security technology group, QinetiQ, interim numbers were very impressive. Earnings came in around 12% better than market forecasts, with the US particularly strong. The dividend yield, at 2.7%, is hardly spectacular, but it is covered more than three time by earnings, so it looks safe. Buy.
Investors Chornicle
Marshalls looks better places than many operators in the building industry, however most of its retail business work comes from work related to building new houses or home improvements. Despite being well places to survive the recession, there is nothing to suggest a near-term improvement on its trading outlook and the share price may come under more pressure. Sell.
THURSDAY
The Daily Telegraph
On Tuesday, Vedanta announced a share buy-back of up to 10% of its equity. This will cost around $250m (£169m) but this will hardly leave a dent in its cash pile of $5bn (£3.38m). The market appears to be unwilling to pay for future growth at this stage in the cycle. Shares in Vedanta look like a bargain right now – as long as you are willing to wait. Buy.
The fact that oil has hit a 3½-year low will focus delegates' minds a the next Opec meeting. Questor believes that the oil price is likely to bounce back to at least $70 per barrel in the next 12 months. ETFS Crude Oil is still a buy.
Shares Magazine
Pursuit Dynamics, investor of unique PDX supersonic shockwave technology, has seen its shares ride choppy waters since they peaked at 360p two years ago. Its blur sky technology sounds wonderful but is usually a good way for investors to lose money as it takes much longer to commercialise than expected and sometimes never does. Sell.
The Times
Only three months after it pulled into the FTSE 100, Stagecoach, the bus and train operator, is set to be shunted out again. That much was evident from yesterday's 17% fall in its shares. At seven times next year's forecasts, the shares might appear attractive but, given the capacity for rising unemployment to send Stagecoach further off track, the shares are still best avoided.
Dawson Holdings, the news and magazine distributor, is beating Smiths to hard-fought contracts and withdrawing from unprofitable deals and pushing through belated efficiency measures. At 57p, Dawson sits at five times earnings. More compelling is a 7½p full-year payout, which Dawson is minded to maintain and which gives a hefty 13% yield. Buy.
WEDNESDAY
The Times
Winter may have arrived, and a chill may have descended on consumer spending, but the sun is still shining on Britain's big tour operators. But even though it is performing well, the key selling period of January and February is still to come and – with unemployment on the rise – it is hard to see Thomas Cook emerging unscathed. Only a hold.
EcoSecurities, the carbon credits group, could face a shortfall of up to half a million credits in the first quarter. Investing in carbon has never been for the fainthearted and EcoSecurities' 4% fall yesterday suggests that this latest glitch has a far greater psychological impact than financial. Hold
The Daily Telegraph
Nuclear power may be controversial, but it is nevertheless a way of producing electricity that generates few emissions and it can give a country independence from foreign oil and gas. Questor believes that the re-emergence of nuclear as a major part of the world's energy plan is virtually unstoppable. This makes TFS WNA Global Nuclear shares a buy.
TUESDAY
The Times
Reed Elsevier is Europe's biggest media business, worth nearly £12bn, but with none of the profile to match. A low disposal price for RBI, or even a pulled sale, is probably broadly priced into the shares now, but there are few catalysts to lift the share price. In a tough market, Reed is worth holding for its defensive qualities. Hold.
Aberdeen Asset Management's increase in both profits and funds under management during the most turbulent period for investment markets in living memory is some achievement. The presence of Mitsubishi, of Japan, as a 10% investor, with the option to go to 19.9%, increases stability. Hold until markets stabilize.
The Daily Telegraph
Pennon's water business should be solid and reliable, but waste unit Viridor has good prospects for growth. Pennon issued its first-half report on Thursday and revenues at its South West Water business rose 3.8% to £223.1m despite lower demand. The shares are trading on a March 2009 earnings multiple of 12.3 times and implying a yield of 4.9%. Shares in Pennon are a buy.
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