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Press headlines and tips: ARM Holdings, Electrocomponents, Northbridge Industrial Services

Our summary of all the shares tipped by the quality papers on Saturday and Sunday
February 4, 2013

Welcome to our summary of the weekend's quality press tips, provided on Mondays by Weekend City Press Review.

PRESS TIPS:

The Times

Tempus: Patrick Hosking says UK shareholders in Santander - the second most-widely share held in Britain - should hang on if they can stand the 'bumpy ride' ahead, although 'those of a more nervous disposition should sell' (Last IC rating: Sell, 9 Feb 2012).

The Independent

No Pain, No Gain: Derek Pain says trading updates from recent portfolio recruits Essenden (No IC rating) and Findel (Last IC rating: Fairly priced, 4 Dec 2009), both recovery plays, suggests 'headway is being made'.

The Sunday Times

Inside the City: Danny Fortson thinks it time to take profits at ARM Holdings, 893.5p, where the shares appear to have got ahead of themselves because of investor enthusiasm for its smartphone chips (Last IC rating: Hold, 25 Jul).

■ The City seems likely to be unimpressed by GlaxoSmithKline CEO Sir Andrew Witty's review of European operations this week, but expect a new round of share buybacks to compensate (Last IC rating: Hold, 25 Jul).

The Sunday Telegraph

Questor: Garry White says hold BT Group, 265p, for its rising yield (Last IC rating: Buy, 14 Nov).

■ Hold Electrocomponents, 258.5p, for income, although nervous investors might want to take some profits in case the economic recovery on which it depends is delayed (Last IC rating: Sell, 8 Nov).

The Mail on Sunday

Midas: Joanne Hart says buy Northbridge Industrial Services, 277p, which looks undervalued at present but offers significant potential growth over the next few years (Last IC rating: Hold, 27 Sept).

Update: Take some profits in GB Group, tipped in June 2009 at 23p and now 92p, but hold the rest for further upside (Last IC rating: Good value, 4 Dec 2009).

  

Business press headlines courtesy of Weekend City Press Review:

Barclays chief Jenkins gives up likely £2.7m bonus in wake of new scandal

New Barclays CEO Antony Jenkins is to waive his £2.75m bonus for last year after a 'torrid week' for the bank, including allegations that the bank loaned Qatar money to invest in Barclays at the height of the 2008 financial crisis. The decision is likely to put pressure on the CEOs of Lloyds Banking Group and HSBC to follow suit, while Royal Bank of Scotland CEO Stephen Hester has already pledged to forgo his 2012 bonus. [Financial Times pp.1, 15]

Mobile giant plots £10bn float

Deutsche Telekom and France Telecom are planning a £10bn IPO later this year for their EE (formerly called Everything Everywhere) mobile joint venture created out of the merger of Orange and T-Mobile in the UK. EE's owners are in the process of appointing advisers for the IPO, which would see 25 per cent of the company offered for sale. [Sunday Times p.3.1]

RBS risks criminal action over Libor scam

US prosecutors are reportedly keen to press for criminal charges to be brought against Royal Bank of Scotland over the Libor rate manipulation scandal, which is expected to cost the bank £500m in fines levied by the UK and US authorities. The fines are set to be announced on Wednesday, when RBS's investment banking head John Hourican is also likely to confirm his departure. [Sunday Times pp.3.1, 3.5]

Facebook helps itself to 10-year tax holiday

Facebook may not have to pay US corporation tax for the next decade because of a US$13bn tax credit it has built up following its stock market float last year. Under US accounting rules, Facebook can use paper profits from employee stock options schemes to offset against future tax even thought no money was actually paid out. [Sunday Times p.3.1]

Increase rates while you can, Bank urged

The Bank of England is coming under pressure from economists to raise interest rates by 0.25 percentage points when the Monetary Policy Committee meets this week. The shadow MPC, which operates under the auspices of the Institute of Economic Affairs, believes rates should start to rise to help return them to 'normal' levels without damaging the economic recovery. [Sunday Times p.3.2]

Rose back behind the counter

Former Marks and Spencer chairman Sir Stuart Rose is to become chairman of the Fat Face clothing chain, owned by private equity firm Bridgepoint, where he will reunite with ex-M&S colleague Anthony Thompson who is now Fat Face's CEO. Rose's appointment is the second non-executive chairmanship he has taken on in the past fortnight following his decision to join online grocer Ocado, due to update the City this week on its trading and financial performance. [Sunday Times pp.3.1, 3.2]

Osborne in new threat to banks

George Osborne is due to make a major speech on Monday outlining new reserve powers to force a break up of the banks if proposals to ring-fence retail and investment banking activities fail to work. Details of the new powers were still being negotiated with Business Secretary Vince Cable over the weekend, with Treasury sources suggesting the Chancellor would not back 'blanket' powers over all banks, but only on those found to have broken the rules. [Sunday Telegraph p.B1]

RBS plans branch IPO after Santander failure

Royal Bank of Scotland is planning to float the 316 bank branches it failed to sell to Santander after finding a lack of real interest from other trade buyers. RBS is now pushing ahead with a £1bn IPO, known internally as 'Project Rainbow', although the exact details have yet to be finalised. [Sunday Telegraph p.B1]

Prudential CEO demands Carney quit QE or risk further turmoil

Prudential CEO Tidjane Thiam has warned Mark Carney, who becomes the Bank of England's Governor in the summer, that he should stop the quantitative easing programme because it risked causing fresh financial turmoil. Thiam, speaking at a private breakfast last week, said that while QE was a useful weapon for policymakers during the financial crisis, it now distorted monetary policy and was storing up future inflationary problems. [Sunday Telegraph pp.B1, B6-7]

Heathrow signals confidence in future with £3bn investment

Heathrow is set to announce £3bn modernisation plans later this month irrespective of the current government review into future capacity. The airport intends to extend terminals two and five along with improvements in baggage handling, although the costs will be recovered from a sharp hike in a charges for airlines using the airport. [Sunday Telegraph p.B1]