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News & Tips: Vodafone, Afren, Lonmin, ITV, Oxford Instruments, Stobart, De La Rue, Salamander Energy & more

Today's market overview

Equities are selling off again, and The Trader Dominic Picarda is looking for opportunities to short the markets.

IC TIP UPDATES:

Vodafone ( VOD ) shares are off a little after the telecoms giant reported a flat trading performance in the six months to September, mainly due to deteriorating conditions in southern Europe. But adjusted profits were up by 8.5 per cent to £6.2bn and are expected to be towards the upper end of guidance for the full year. A £2.2bn dividend from Verizon Wireless is due before the end of 2012, after which Vodafone will launch a £1.5bn buyback.

Sell recommendationLonmin ( LMI ) has issued a further plea to investors to give their backing to its rescue rights issue, reminding them that the recent amendments to its banking facilities were reliant on a fundraising completing this calendar year and a failure to do so could leave the company in serious financial trouble.

A ramp up in production at Afren ( AFR ) has produced record revenues of $1bn. Production is running at a gross level of 57,265 barrels of oil per day. The company also has a very active drilling programme. We maintain our buy.

Buy recommendation ITV ( ITV ) has announced solid revenue growth in the nine months to September and also said its cost savings plan is £10m ahead of its original target and should deliver £30m of savings this year.

Logistics specialist Stobart ( STOB ) has announced details of its retail bond offering, the six year issue is offering a coupon of 5.5 per cent.

Sell recommendationCRH ( CRH ) has seen trading deteriorate in the third quarter of the year with previously solid trading in the US falling away and European performance getting worse.

Oxford Instruments ( OXIG ) grew revenues by 7.4 per cent in the first half of the year while adjusted pre-tax profits shot up by 23.5 per cent to £23.1m. Buy.

Cineworld ( CINE ) has held its own despite a quieter release period and the distractions of the Olympics. Total revenues for the 45 weeks to 8 November were flat and the company is hoping that big ticket releases such as the latest Bond film Skyfall and the culmination of the Twilight series will boost the final few weeks of the year. We keep our buy recommendation.

Housebuilder Persimmon ( PSN ) has reported solid trading conditions with weekly selling rates running 4 per cent ahead of the same period last year. Buy.

Norcros ( NXR ), which supplies bathroom equipment, has benefited from a strong rebound in trading at its South African operations which has resulted in a 3.8 per cent improvement in revenues in the first half of the year and a 53.5 per cent rise in pre-tax profits. We keep our buy rating.

KEY STORIES:

Capita Group ( CPI ) has issued a solid trading statement with its order book flat at £4bn after £1.7bn of contract wins in the year to date.

Awful market conditions continue to hamper Johnston Press ( JPR ), which has reported a worsening of trading in the opening 18 weeks of the second half with sales down 11.4 per cent on a like for like basis.

Bank note printer De La Rue ( DLAR ) has warned that a number of orders which were expected to fall into the current financial year have now shifted, which means the full year performance is only likely to be in line with last year’s effort.

Salamander Energy ( SMDR ) has announced disappointing results from a small exploration well offshore Thailand.

TalkTalk Telecom ( TALK ) has experienced another flat performance with total net customer loss of 4,000 in the second quarter. Underlying earnings in the six months to September were £155m at a margin of 18.7 per cent, up from 17.3 per cent last time out.

OTHER COMPANY NEWS:

Sportingbet ( SBT ) has been granted an extension by the takeover panel to try to conclude negotiations with William Hill ( WMH ) and GVC Holdings ( GVC ) over a possible takeover.

Industrial and office property specialist Workspace Group ( WKP ) has announced a 46 per cent leap in pre-tax profit to £24.6m in the first half of the year.

READ MORE...

Read today's press headlines and share tips.

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By Graeme Davies,
13 November 2012

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