Newspaper and magazine share tips

By This Is Money
Updated: 06:58 EDT, 27 August 2010

Each day we round up share tips from national newspapers and investment magazines. For the Mail on Sunday's stock picks, read the Midas column.

Round-up: Latest share tips from the national newspapers and investment magazines

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FRIDAY

The Daily Telegraph

Mining services group, AMEC have impressed analysts with their well balanced books from recently released half year figures. A net cash haul of £669.6m and pre-tax profits of £113.5m sat next to an order book up 5% to £1.81bn. The company has set a target of increasing earnings (before interest tax) by 8.5% and despite the first half figure standing at 7.9%, the group are confident they can achieve this. AMEC is also looking to make acquisitions, but with a thrifty management team in place, these are not likely to cost excessive amounts. AMEC shares are up 68% and should continue to do well for investors. Buy.

Carillon is a construction business that has been busy diversifying the services they offer in order to ride out a tricky time for the industry. The move seems to have worked. Figures released yesterday show about half of the group's profits coming from support services and pre-tax profits rose by over £8m. Carillon won £3bn worth of contracts in this first half of the year and the order book stands at a healthy £18.9bn. If the company wins contracts following the government's upcoming spending review, as it expects to, then the prospects longer-term look even more promising. Buy.

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The Independent

Britain's largest listed student landlord, Unite, has seen assets rise by 8% according to figures released yesterday. Changes in government policies regarding universities could slow the volume of students requiring private accommodation. The fact however, that student property market in university towns is still in short supply, cannot be ignored. Rent is expected to increase by 4% over the full year and international intakes to British universities are expected to rise also. This all makes for a positive outlook, with negligable risks. Buy.

One of the oldest football gaming businesses in the world have seen a reduced profit in the first half of this year and the signs going forward are not great. In the early 90s Sportech attracted around 10m players to the pools each week, this figure now stands at 500,000. Despite attempts at modernisation from the company and a proposed acquisition of Scientific Games Racing, it is probably best to see how things go before making a commitment. Hold.

The Times

Three successful results from wells in the Catcher prospect have seen oil producers, Premier Oil, experiencing a surge in share prices. Interim figures show that the company's post-tax operating cash flow stands at $222m, double the figure from the previous six months. A 17% rise in production and higher oil prices are expected to be responsible for the increase. With lofty ambitions for new production targets, Premier Oil look set to remain on top. The shares are a buy.

Global drinks producer, Diageo, have released figures that are satisfactory but not very inspiring. Sales are up 2% and 3% on market spend. In terms of short-term prospects, you could do better. But credit where credit is due, the group emerged relatively unscathed from the depths of the economic downturn and their stable, steady growth could be worth a look for longer-term investors. Buy with caution.

Investors Chronicle

A new technology –driven approach to improving asthma treatments may see pharmaceutical company, Vectura, doing very well. Having just signed a £20m deal with GlaxoSmithKline, who own the rights to license Vectura's Powderhale technology, the firm are reporting a cash balance of £64m. Despite this, the drug is a long way from the open market and with guidelines for approval in the US still in development, this could be a very long-term investment. Things still look good for the release of the drug in Europe within the foreseeable future and with so much cash behind them, buy.

Low cost airline easyJet have been experiencing a bit of turbulence over the last few weeks, and it is starting to impact share prices. Poor punctuality at Gatwick and trouble at the top, with Sir Stelios threatening legal action against the board if things do not improve, mean the airline are facing tough times ahead. Ambitious expansion plans including the buying of expensive landing slots at expensive airports and the ordering of lots of new Airbus planes have left finances shaky. Staffing problems add to the uncertainty. Until things become clearer, sell.

THURSDAY

The Independent

Struggling structural steel suppliers, Severfield-Rowen, released some worrying figures yesterday. Revenue has taken a 37% nosedive and profits after tax are around 75% lower than their previous six months. Despite this, bosses have assured investors that their performance has been 'relatively strong' given current market conditions for the steel industry and the state of the economy in general. But with an order book down by £12m and many public sector building projects expected to face the chop, sell.

Mobile banking providers, Monitise, may not have been around for that long, but with over 100,000 new customers every month, they are leading the way in what is sure to be a growth area. In the months preceding June, profits have risen by 125% and there is a promising deal with Visa in the pipeline. Natwest and Lloyds customers already benefit from Monitise smartphone applications that allow them to 'mobile-bank' but the other banks are sure to follow suit. Buy.

The Telegraph

BAE Systems, Europe's largest defence group, may well be experiencing their lowest share prices for five years – but profits are still on the up. The company's refocus on service and support for products throughout their lifetime should provide a steadier flow of income. A recently well-timed share buy-back should also reap rewards when its markets recover. The UK's upcoming Defence and Security Review may reassure investors of BAE's longer-term prospects. But with the UK representing only 19% of their customer base, a coalition cutback in this area would not devastate the firm by any stretch of the imagination. Buy.

Impressive revenues of $52.8bn and a pre-tax profit of $19.6bn stand BHP Billton in good stead for its planned acquisition of PotashCorp later this year. The largest mining company in the world has said they don't want to pay over the odds for PotashCorp, but expectations are that the current $130-a-share offer will rise. This bid and worries about slow long-term growth have caused share prices to fall recently, but at 11% below the recommendation price these shares are still a buy.

The Times

Costain maintain around a third of Britain's motorways but have recently announced plans to bid for the building contract for a new generation of nuclear power stations. Such an announcement has unnerved some analysts and investors, particularly given the fact that share prices have been reduced by over a quarter since March. Anticipated public sector spending cuts have prompted the reduction but chief executive Richard Wyllie, intends to expand and diversify existing business - it could take a while to pay off, but is still a buy.

Irish dairy producers Glanbia have identified a potentially profitable trend in recent US markets. It is hoped that rising unemployment in the US could see sales of Glanbia's protein powders on the increase. According to chief executive John Moloney, the unemployed are more likely to spend time at the gym while they have no job to tie down, and a potentially vulnerable level of self-esteem. With a 39% increase in profit reported for the first half of the year, Moloney may well be right. Buy.

WEDNESDAY

The Independent

Edinburgh based oil/gas exploration and production company Cairn Energy, have reported impressive half-year financial results. Having increased revenue by 300% to $333m, the company look set to make a $58.5m profit as opposed to last year's $118m loss. The streaming of Rajasthani oilfields and increased production have contributed to the revenue boom. New oilfield discoveries in the Arctic look promising for the future of Cairn, but difficulties with drilling procedure regulations in the area mean that any commercial benefit is a long way off. Hold.

Promethean World, specialists in the development of electronic classroom technology, has experienced tough times since they were listed in London in March. After peaking at 213.5p, their share prices have been falling steadily. However, a half-year statement reporting revenues in the six months before June were up 35%, combined with positive longer-term trends and solid company potential mean that now could be a good time to buy.

The Times

Managing to cut £60m of costs out of the business last year have left instrumentation and controls manufacturer, Spectris, looking like a promising investment. First –half sales were up 9% and the company have managed to cut net-debt by £93m. Despite some cost-saving initiatives being 'one-offs', Spectris have insisted that, with further adjustments, the same can be achieved in the future. Shares prices for Spectris may have more than doubled since March but on any further weakness, buy.

Copper mining giants, Antofagasta, seem to have share prices linked inextricably to the price of metal on the world markets, but their recent half year report makes interesting reading for investors. Having increased copper production to 252,900 tonnes, 16% higher than the first half of 2009, the company has made improved net earnings by 91% making a hefty $451.2m. Disruption from the Chilean earthquake has reduced overall production estimates from the year and with 15% of production ending up in China, any downturn in Chinese markets could spell bad news. Hold.

The Daily Telegraph

Yesterday' s reports that diamond producers, Gem Diamonds, have seen a significant fall in profits, have prompted the company to assure investors that they will be taking steps reduce future losses. One of the firm's Australian pipes will be closed in order to try and offset the recovering price of diamonds. In the first six months of the year pre-tax profits fell from $18.2m to $7.8m. Despite the losses, Gem are comfortable with analysts full year estimates, with two potential acquisitions in the shape of Finsch and Namaqualand in the pipeline. Until things become clearer, hold.

After a difficult year for the mining sector in general, the future for copper seems fairly bright. Profits for Antofagasta have soared in the first six months of 2010. However full- year production forecasts being cut due to the Chilean earthquake disaster does take the shine off such good news. 2011 should see full-year production at 700,000 tonnes which should comfort potential investors of long-term potential despite current difficulties. With so much of the firm's business tied up in China, any problems there could spell danger. But with the Chinese government due to ease lending curbs placed on banks, Antofagasta could prosper. Buy.

TUESDAY

The Daily Telegraph

International oil and gas provider Petrofac may be commanding a hefty price for shares, but they could well be worth every penny. The company's net cash balance at the end of the first half was $960.6m, one fifth of the company's market cap and a backlog of orders and new business deals worth of $1.1bn make Petrofac a promising investment. A potential deal in Turkmenistan worth $4bn would improve company prospects and its lack of involvement with deepwater oil works, mean that it will be immune from a tightening of restrictions in the Gulf of Mexico. Buy.

James Fisher, specialist marine technicians with customers such as Shell and Chevron on their books, has seen a profit in their marine oil division for the first time in six months. The turnaround comes after a number of cost-saving initiatives and an increase in contract volumes carried by their fleet of tankers. The six months preceding June 30 saw overall revenue rise by 1% and pre-tax profits up 4%. The interim dividend was raised by 5% to be paid on November 4 so if you are thinking about investing, buy before October 6 to benefit from the payment.

The Times

Despite seeing an improvement on its terrible start to 2009, the prospects for Bovis Homes are far from secure. A fragile recovery and a pretty flat level of sales over the last few years have left Bovis reporting losses of £8.6m. However Bovis could be in a good position to begin enjoying an upturn in profits, having recently reported pre-tax profits of £3.5m. The company have acquired enough land to see out seven years of building projects and a recent lull in sales could be put down to a 'summer lull'. The market is too uncertain to take too much of a plunge. Hold.

Petrofac have forecast a 20% surge in profits for the year following a deal with a firm in Iraq, meaning its order book has now reached an estimated $8.1bn. Petrofac's unique approach to fixed-price contracting (despite project overrun risks) and investment in the development of oil field development have proved lucrative. Many customers have chosen Petrofac because of this less aggressive approach to contracts, but it is a strategy could prove dangerous if a large scale project is misjudged. Sell.

The Independent

An overview of the retail sector was in The Independent today and the outlook for retailers across the sector remains gloomy. The prospect of a VAT increase to 20% in January and clothing prices expected to jump 8% as a result of chain supply costs does not bode well. However, for brave investors there could be some money to be made from the slump. Share prices at the moment are cheap and with 2010 turning out a more profitable high street than expected, it could be a good time to buy. Top tip for the retail sector is Halfords. The bike and car parts retailer (who sell one third of all bicycles bought in the UK) has been expanding its servicing and repairs business through various acquisitions and there are a further 12 targets in their sights.

Other good options in the retail sector include N Brown, a plus-size mail order shopping specialist. The retailer has recently acquired a number of plus – size competitors including High and Mighty, Figleaves and the launch Simply Be in the US. As the average size of a woman in the UK rises to size 16, the plus-size market is expected to continue increasing, along with consumer waistlines. A good time to buy.