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Share Price: 55.48
Bid: 55.46
Ask: 55.50
Change: 0.74 (1.35%)
Spread: 0.04 (0.072%)
Open: 54.22
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Low: 54.22
Prev. Close: 54.74
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Tuesday tips round-up: Ricardo, Aggreko, Reed Elsevier

Tue, 27th Sep 2011 06:48

Ricardo has never been busier turning out the sort of supercars that would seem to be out of the price range of anyone barring investment bankers and Russian oligarchs. The company's performance products division, which is the part of Ricardo that actually makes things as opposed to advising how to, was behind a stellar performance from the group as a whole. The shares had motored until the inevitable slump this summer and now sell on less than 13 times' earnings, which looks like decent value for such a quality business, says the Times.Not that long ago, you could not give away shares in Aggreko, the Glasgow-based temporary power supplier. Today, although the indiscriminate turmoil of world investment markets has seen the share price fall sharply from a peak of about 2,100p, they are still up by about 25% this year. Investors looking for exposure to a progressive improvement in global economic activity might wish to analyse the stock further. Buy, says the Scotsman.The publisher and information provider Reed Elsevier yesterday announced that it had agreed a deal to buy Accuity Holdings from the investment firm Investcorp. The acquisition is a pretty chunky one, coming in at £343m in cash. The companies said the deal would be earnings-accretive immediately. Bank of America Merrill Lynch has done the maths and said the deal implied revenue of about £120m in 2012 with earnings before interest, taxation and amortisation of £36m. In the publishing industry, Reed is among the top investment picks. Buy, says the Independent.The end-game is approaching at Axis-Shield and the omens are not good for the healthcare company as it tries to fight off a £230m takeover bid from the rather larger Alere. The American company refused yesterday to up its 460p-a-share hostile offer. The terms do not look generous, about 25 times' this year's earnings falling to 13 times those for 2012-13, which is not a terribly high multiple for a diagnostic company. Investors should stay in for developments, says the Times.The lack of response to Nautical Petroleum's results from its appraisal well on the Kraken oilfield east of the Shetlands was a surprise. Nautical has almost £80m of cash in the bank but nowhere near the resources needed to develop Kraken, which could require a total investment of $1bn. That cash is worth 88p a share, while the oil and gas team at Numis Securities has valued the company's stake in Catcher at 199p, which suggests that Kraken is in there for very little.Numis says that Nautical shares are on little more than 40% of their estimate of its fully risked net assets, a discount to the sector as a whole. But, as ever with oil explorers, there is plenty of risk that things will go awry.Flying Brands, the home shopping firm that courts customers directly via catalogue promotions, press adverts and the internet. In a trading statement last week, it said that it was nearing its autumn selling season in its Gardening Direct arm "and the performance of the business has been significantly below management expectations". Trading elsewhere had also been less than cheery. The bad news was followed up by signs of progress yesterday, with Flying Brands saying it had agreed terms to offload certain non-core-property assets. The deal, which is subject to shareholder approval, is positive, and would significantly enhance the balance sheet. Hold, says the Independent.The Daily Telegraph takes a look at the six shares UBS has selected to include in the index and assesses whether an investment in these shares will be a good or bad idea. An investment in Lloyds Banking Group "must be regarded as speculative"; in retail buy Kingfisher but avoid Home Retail Group; in property hold Segro but buy housebuilder Barratt Developments; and hold easyJet, the paper says.Please note: Digital Look provides a round-up of news, tips and information that is impacting share prices and the market. Digital Look cannot take any responsibility for information provided by third parties. This is for your general information only as not intended to be relied upon by users in making an investment decision or any other decision. Please obtain a copy of the relevant publication and carry out your own research before considering acting on any of this information.
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