Sunday newspaper and magazine share tips

 

We round up the Sunday newspaper share tips, including Rio Tinto, advertising giant WPP and Halfords.

investing

Financial Mail on Sunday: Midas

Today's Midas column tips Places for People, the first non-for-profit landlord to join the London Stock Exchange.

›› Read the full Midas column here

Sunday Telegraph

Shares in Rio Tinto are down significantly from their February high of 4712p, but with earnings set to be buoyant for the next few years, now looks like a good time to buy. One broker, Citigroup, said the shares, currently at 4107.5p, had 'never looked cheaper'.

Rio has managed to turn around its balance sheet in spectacular fashion since carrying more than £24bn of debt following the purchase of Canadian aluminium group Alcan.

It has used a rights issue, asset sales and a strong recovery in commodity markets to find itself in a net cash position at the end of this financial year. Rio is heavily weighted in iron ore and does not have any oil operations, which can act as a natural hedge for rising costs in its mining operations.

Advertising giant WPP said last week that revenues this year were expected to rise by 6%, largely down to fast-growing markets in Asia-Pacific, Latin America and Africa. Net debt has fallen by £590m to £2.3bn, with strong cash flows totalling £1.2bn in the first four months of the year.


Shares were 814.5p in March and are 10% below this level, compared with a 2% decline for the FTSE 100 Index. The fall looks overdone and shares are a buy at 739p.

Sunday Times

Is it possible that Pinewood Studios chairman, Lord Grade is feeling uncomfortable about the sale to largest shareholder, Peel Holdings? It seems that despite buyer interest from former Harrods owner, Mohamed al-Fayed, the only thing which could scupper plans is the Office of Fair Trading.


It is currently examining if, with the sale, Peel will have too large a share in the TV production market. While shares are currently trading at a 23% premium to last summer's listing price, investors might be better off without the Lord.

Investors seem to have mixed feelings about Halfords' boss, David Wild. It has been downhill since the start of the year and sentiment took another knock last Friday when it emerged that Halfords was on the hook for £7.5m of lease payments linked to the collapse of retailer Focus DIY.


It is expected that the company will announce a 7% rise in annual pre-tax profit to £125m on Thursday. Picking high-street winners is difficult at the moment but the Sunday Times thinks that Halfords might just be one of them.