Welcome to our summary of the weekend's quality press tips, provided on Mondays by Weekend City Press Review.
PRESS TIPS:
The Times
■ Tempus: Martin Waller reviews his ten stock picks for 2013, and finds the bar set high for 2014: of the ten, one was a runaway hit (Thomas Cook (TCG), 147.5p - Last IC rating: Hold, 20 May); four managed rises of between a third and a half (Hutchison China MediTech (HCM), 565p - Last IC rating: Buy, 30 Jul; Lamprell (LAM), 142.25p - Last IC rating: Hold, 2 Sept; GKN (GKN), 352p - Last IC rating: Buy, 30 Jul; Interserve (IRV), 562.5p - Last IC rating: Hold, 14 Aug); a couple were a shade down (Fortune Oil (FTO), 10p - Last IC rating: Buy, 28 Aug; Glencore Xstrata (GLEN), 344p - Hold, 20 Aug); a couple were a shade up (Pearson (PSON), £12.58 - Last IC comment: 26 Jul; BP (BP.), 441p: Last IC rating: Hold, 30 Jul), and the average was 41.4 per cent up, ahead of the 10.4 per cent rise seen by the FTSE 100.
[ p.62 ]
The Independent
■ No Pain, No Gain: Derek Pain reviews SnackTime (SNAK), fallen from 119p a share four years ago to 15p, as Vendia Groep take a 30 per cent stake and Boris Belotserkovsky a 7.9 per cent slice (No IC rating).
■ Market Report: Buy Babcock International (BAB) (Last IC rating: Buy, 14 May), £12.01; Hold Carillion (CLLN) (Last IC rating: Buy, 29 Aug), 314.1p; Sell Electrocomponents (ECM) (Last IC rating: Hold, 23 May) 276.3p.
[ pp.63, 56 ]
The Daily Mail
■ Investment Extra: Sam Dunn looks at the influence of Invesco Perpetual's Neil Woodford.
[ p.92 ]
The Sunday Times
■ Inside The City: Danny Fortson says buy Dunelm (DNLM) (Last IC rating: Hold, 12 Sept), 926p; a six-fold rise in five years looks set to continue, and Oriel Securities set a £10 target price for the shares.
■ Borders & Southern (BOR) is 12 months into a Falklands sale that show no sign of progress, and a cash pile that has shrunk from US$124m to US$25m over the same period; a long shot at best (Last IC rating: Hold, 28 Jan).
[ p.3.12 ]
The Sunday Telegraph
■ Questor: Says buy Thomas Cook (TCG), 147.5p; the transformation under Harriet Green has been impressive, and the recovery has survived the 7 per cent fall over Egyptian unrest, and while the shares are 10 times higher than a year ago, there is still room for improvement (Last IC rating: Hold, 20 May).
■ Buy Hyder Consulting (HYC), 487p; trading on a forward p/e of 11.8 times in 2014, the shares are at an unfair discount to WS Atkins on 13 times (Last IC rating: Buy, 15 Aug).
[ p.B8 ]
The Mail on Sunday
■ Midas: Joanne Hart says Fairpoint (FRP), 124.5p, is a strong long-term investment; with solid three-year growth prospects and a generous dividend (Last IC rating: Buy, 12 Sept).
■ Update: Holders of Monitise (MONI), tipped at 12p in 2008 and now 57p, could sell 20 per cent but should hold onto the rest; new investors could also gain; supporters anticipate a 100p target in 2014 (Last IC rating: Buy, 5 Sept).
[ p.86 ]
Business press headlines courtesy of Weekend City Press Review:
Hedge fund pushes for G4S split
Cevian Capital, the largest activist hedge fund in Europe, is pressing G4S (GFS) to explore the sale of its cash solutions arm, which provides 25 per cent of profits. Chief executive Ashley Almanza, who took over from Nick Buckles in July, is to unveil plans to slim down the company on 5 November, when he is expected to favour offloading non-core businesses. Cevian became G4S's largest shareholder with a 5.1 per cent stake last month. [Sunday Times, p.3.1]
Pawnbroker scrambles to secure cash lifeline
Albemarle & Bond (ABM), the UK's second largest pawnbroker, is understood by the Sunday Times to be finalizing a fund-raising of between £15m and £20m to bring debt under control; borrowings stood at £50.3m at the beginning of the year. Profits are said to have dropped by 50 per cent to £12m for the year to the end of June. [Sunday Times, p.3.1]
Strike could batter shares: Royal Mail
Royal Mail has warned that a strike would have a 'materially adverse' effect on its £3bn stock market listing, and would cause the share price to fall significantly, in the 450-page prospectus for the float. It was also revealed that £67m has been set aside to cover potential asbestos-related claims, and that £1.5m-salaried chief executive Moya Greene elected to draw down £281,000 from her pension. [Sunday Times, p.3.2]
Icap brokers demand trial in UK
Daniel Wilkinson, one of the three former Icap (IAP) brokers facing charges from the US Department of Justice over alleged rigging of the inter-bank Libor rate wants the Serious Fraud Office to take charge of the case in the UK. Icap agreed a £55m settlement with US and UK regulators over failings in compliance that allegedly allowed the three traders to rig the rates. Mr Wilkinson's solicitors argue that, as the alleged collusion w took place in the City and was between the UK and a UBS trader in Tokyo, the US has no jurisdiction. [Sunday Times, p.3.3]
Wolseley woos City with £300m payout
The UK's largest plumbing part supplier Wolseley (WOS), bailed out in a £1bn rights issue after the housing collapse, is to return £300m with a special dividend next week. Chief executive Ian Meakins oversaw 20,000 job cuts and offloaded several divisions, slashing the company's debt by 80 per cent and beginning to pay dividends again in 2011. From lows of £14 before the rights issue, the shares closed on Friday at £32.42. [Sunday Times, p.3.1]
Energy giants close in on green taxes delay
The UK's large energy supplies are in negotiations with the government to delay the implementation of a multi-billion pound green plan, in order to reduce the pressure on household bills. The ECO scheme is expected to cost £1.3bn a year between 2014 and 2019, or the equivalent of £50 on a household bill. Centrica (CNA), owner of SSE (SSE) and British Gas, is asking for an 18-month reprieve, the effects of which it would pass onto consumers. [Sunday Telegraph, p.B1]
Splitting RBS will allow taxpayer 'to make bigger profit'
A report by UBS suggests that, rather than simply dividing Royal Bank of Scotland (RBS) into 'good' and 'bad' banks, its should be restructured more radically by completely splitting off its US Citizens business and the loss-making Irish Ulster Bank. Current RBS shareholders would take a one-third stake in the remaining 'good' bank with the state (currently owners of 81 per cent of RBS) taking the rest and the 'bad' bank coming onto the national balance sheet, where it could be wound down. UBS expects shares in the 'new' RBS to trade at around 540p, well above the 500p government break-even. [Sunday Telegraph, p.B1]
Heathrow CEO: price cap threat to airport
Colin Matthews, chief executive of Heathrow Airport, has said that a possible cap on prices paid by airlines would put the airport in a worst position than rival airports in Frankfurt and Paris. The CAA is widely expected on Thursday to suggest a cap of 1.3 per cent below the RPI between April 2014 and 2019, allowing a maximum return on investment of 5.35 per cent. Mr Matthews says he agrees that airport charges on passengers should be 'not a penny more than is necessary', but some price increases are needed to improve facilities; investors in Heathrow make returns of less than 1 per cent, he says. [Sunday Telegraph, p.B3]
Tesco sales fall again as foreign divisions suffer drop in profits
Tesco (TSCO) is expected to report a further UK like-for-like sales drop of between 0.4 per cent and 0.7 per cent when it announces its Q2 interims, while J Sainsbury will reveal a 1.8 per cent rise. Tesco is expected to reveal a 6 per cent fall in Asia and a 20 per cent drop in European profits, meaning group profits will fall for the second consecutive year. [Sunday Telegraph, p.B1]
Top aide to Cable warns of Lloyds sale disaster
Lawrence Tomlinson, a senior adviser to business secretary Vince Cable, told the Mail on Sunday that the sale of government-owned shares in Lloyds Banking Group (LLOY) could be as big a mistake 'as Gordon Brown's ill-timed gold selling in the late 1990s'. 'What bank funds a crippled business and sells it back to the market at the original price?' asked Tomlinson. [Mail on Sunday, p.83]
