Newspaper and magazine share tips

By This Is Money
Updated: 07:12 EDT, 12 March 2008

Each day, This is Money compiles share tips from national newspapers and investment magazines...

FRIDAY

Investors Chronicle

Real estate company Brixton offers sufficient attractions to help allay fears about falling values of commercial properties. The group has focused on the South East when demand remains firm. – Buy

Building maintenance and contruction company Rok has just reported its seventh successive year of record first-half profits. It looks like a low risk operation whose shares are trading 23% below this year's high. - Worth buying

The business climate could get harsher for Sports Direct. It has protected profits by raising prices, but this policy is unsustainable in the long term and a combination of falling sales, rising costs and running an almost-exclusively leasehold stores portfolio is a good way to lose money. - Sell

European Goldfields has faced comparatively little opposition to developing its Greek mines, thanks to having a powerful local conglomerate as shareholder. With total reserves of nearly 10m ounces of gold, 78m ounces of silver and 800,000 tonnes of copper, the company is beginning to live up to its name. - Buy

Axeon makes batteries and control packs for the auto industry. It has taken a while for it to gain traction, but electric vehicles are now beginning to win over business customers and Axeon's time may have come. - Buy

Vindon Healthcare can number several blue-chip pharmaceutical companies among its customers. As they look to outsource the storage of drugs and compounds, there is growning demand for Vindon's services. - Buy

THURSDAY

The Telegraph

The only mystery surrounding yesterday's agreement between SABMiller and Molson Coors to merge their US operations was why it had not been done sooner. With emerging markets' taste for lager booming and Europe in love with new foreign beers, shareholders should charge their glasses now. Buy.

Like many in the sector, the shares have been weighed down of late by conditions in the market place, but Telford is in a niche that should escape the worst of any downturn. At 300½p yesterday they trade on an undemanding multiple of nine times next year's forecast earnings, and yield a pleasant 3%. Buy.

The Times

It is tempting to read yesterday's 7% fall in the shares as punishment that Experian, unlike GUS, has overpromised and underdelivered. But at 16 times next year's earnings, it is worth holding on.

Carphone Warehouse, the £3.1bn retailer, celebrated a significant landmark in its 18-year history last month when it joined the FTSE 100. A more interesting development was little noticed: Carphone has begun selling laptops, Apple TVs and wireless gadgets in its stores. The full-year outlook was strong and Carphone's coup in securing rights to sell the iPhone, alongside O2, should be a winner this Christmas. At 352p, or 18 times 2008 earnings, the shares are not cheap, but are worth holding.

The Independent

Despite the solid performance and yesterday's sell off, there are not enough good reasons to buy the shares. Hold.

WEDNESDAY

The Independent

The mining sector has been on fire since 2004. But there are some pockets of value left and given global political tension, the precious metals end of the market is particularly attractive. Hochschild Mining is a low-cost producer because it follows seams of silver, rather than proving reserves before starting. The shares trade on 10 times forecast 2009 earnings so investors with a healthy appetite for risk should, within reason, ignore the lack of liquidity. Buy

A wet summer, lack of any major sporting events, and the smoking ban have hit beer sales. But profits at Aim-listed Regent Inns were in line with expectations. It operates Walkabout pubs and Jongleurs comedy bars - 'neither should be particularly affected by the smoking ban'. The shares have fallen sharply and now trade at 10.1 times 2008 earnings. That looks a good entry-level price, despite the tough current conditions, and with more consolidation in the sector almost inevitable, Regent's strong cash generation and position in niche markets make it a contender. Buy

It has been an annus horribilis for the IVA industry, with falling applications, higher marketing costs, and big banks declining to play ball. Despite reporting a 61.9% jump in full-year profits to £3.4m yesterday, Debtscouk languishes at an all-time low. Without any obvious short-term catalyst to get the shares moving, now is not the time to gamble. Investors already in the stock should give the benefit of the doubt. It looks like the best play in the sector and should remain profitable, and the number of UK consumers seeking help for bulging personal debt problems remains high. Hold

The Times

The strained state of some of the less prominent financial ratios for Clinton Cards means that the company's low forward earnings multiple of just eight times should not be taken in isolation. All the same, there are reasons why Clinton should continue to fare better than its peers in a downturn: the price of the items it stocks is low, while spending on cards tends to be non-discretionary. A 23% market share means that, for competition reasons, Clinton is confined to organic growth: the focus must be on churning its existing portfolio and adding up to 200 stores. That potential, and Clinton's strengths as a specialist, suggest the shares, at 63¾p, have farther to run.

Although the FTSE 250 computer services group, LogicaCMG, has been in India a decade, it is still underweight there: it has 4,000 staff in the country, 6% of its head count, against 12,000 for CapGemini and 30,000 for Accenture. It is also the territory from where a bid is most likely to come - the likes of LogicaCMG would allow a bidder to get closer to their Western clients and migrate from basic low-cost tasks to higher-margin contracts. This logic means that LogicaCMG, at 166¾p, or 13 times next year's earnings, remains an each-way bet. Keep buying

Steve McLaren is not the only person sweating on England's qualification for the Euro 2008 tournament. Any failure by the football team to make it to Austria and Switzerland would be a disaster for Regent Inns, whose Walkabout sports bars rely on such big events. However, Bob Ivell, Regent's chairman, said that consolidation is inevitable and that, if necessary, he would consider a bid from a rival. Investors may need patience, but strong cash generation and the possibility of a takeover make the shares, at 10.5 times current-year earnings, worth holding.

TUESDAY

The Times

The date is set for the vote on the proposed £8.4bn merger of Friends Provient and Resolution - 5 November. Pearl, however, is expected to table a bid before that. The shares fell nearly 2% yesterday to 682p amid suggestions that Pearl will not pay any more than 660p. That ignores the potential of the Friends deal to create substantial shareholder value - on that basis it is possible to reach a price nearer 800p a share. Pearl could move swiftly but as things stand, not least because of the less substantial savings from putting Pearl and Resolution together, there appears more of a chance of the bid going through in its current form. Hold

Two summers ago, Vodafone said it would stop buying. Yet the weekend's £537m purchase of Tele2's broadband assets in Italy and Spain is only the latest in a clutch of deals. But investors wanted Arun Sarin, chief executive, to show a clear strategy for coping with slowing mobile growth and severe price competition. He has - in Italy and Spain, the broadband market is relatively underpenetrated, at 44% and 57% of households. But is £435 per broadband customer too much? It is certainly in line with recent deals elsewhere. At 168p, Vodafone shares, up 19% this year, trades at 13.8 times next year's earnings. With the company's strategic deficiencies in Europe being tackled, and its emerging markets burgeoning, Vodafone shares are a hold.

Since August's profit warning, Aim-listed giftwrap and stationery maker International Greetings appears to have stepped up its efforts to fulfil the first part of its name; yesterday's purchase of a 50% stake in Artwrap, an Australian rival, marks its third overseas deal in six weeks. That pace is understandable given tough conditions at home – specifically, pressure on margins from its UK own-label customers – that triggered the summer's alert. At yesterday's 263½p, the shares sit 36% below their prewarning level, which seems harsh given that forecasts were cut by just 13%. IG remains tightly held, but, at 9.6 times next year's earnings, and offering a 4% dividend yield, looks reasonable value. Buy