Sunday newspaper and magazine share tips
We round up the weekend share tips, looking at restaurant chain Prezzo and the Templeton Emerging Markets Investment Trust...
Midas: Financial Mail on Sunday
Restaurant chain Prezzo appears to be almost entirely untouched by the chilly climate in the high street. Indeed, the 160-strong chain of Italian eateries is thriving.
Recent results showed that turnover was up 15% to £105m, largely a result of the addition of 20 restaurants. Profits surged 12% to £14.4m. Meanwhile, the group has £5.3m cash in the bank and properties and other tangible assets worth £78m.
Its market value is £145m and dividends are modest at just 0.225p a share for 2010.
The only question is whether Prezzo can maintain this level of growth and profitability if consumer confidence continues to slide.
The evidence so far is that it is well placed in the market and that the skills and experience of its board mean it is a creative outfit able to react skilfully to difficult times. Its position as a good-value midmarket chain means it should weather a consumer downturn well.
Chairman Michael Carlton said the first three months of 2011 had already been encouraging.
Analysts expect profits to rise 10% this year. Shares hit 67p when the results were unveiled. They have since dipped to 62.5p and at this price they are a buy.
The Sunday Telegraph
The Templeton Emerging Markets Investment Trust is one of the best ways to play growth in emerging markets. Mark Mobius, the emerging markets guru who founded the fund, has a very bright team around him that has enjoyed significant success.
Emerging markets were weak in the first few months of the year, but the shares have still managed to recover to near an all-time high of 689.5p, hit in January. The performance of the fund has been consistent and, despite the spectacular performance, the investment remains a core holding for those seeking exposure to growth markets.
Last week, Mr Mobius said shares in the developing world are headed toward double-digit returns in 2011. He added that emerging markets were safer bets than Western economies that were challenged by debt.
He also said that no investors could ignore India, despite recent weakness, and that China's recent under-performance was because of a raft of company flotations that soaked up liquidity from the market.
The unaudited net asset value (NAV) of the fund including income on April 11 was £2.4bn, representing a NAV per share of 726.54p. Hold.
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