UK Stocks and Share tips
Top
of the Tips: Share Recommendations 10/12/2006
Buy
Pennon
Pennon
is one of an increasingly rare breed – companies that
own both a water utility and a waste management operation.
With only six years' landfill capacity left in the UK, Pennon's
waste management arm Viridor looks to be in a very strong
position with its 17 year land bank.
Pennon
shares have risen by 42% this year, and were especially
buoyed by a 30% increase in Viridor's profits. Pennon's
other main arm, South West Water, also reported respectable
8% profits for the year.
With
strong potential for the future, The Times says buy.
Findel
Retail
group Findel have managed to capitalise on the Farepak fiasco,
acquiring Kleeneze, Farepak's sister company in the wake
of Farepak's collapse. Findel have also acquired two internet
retailers this year, Kitbag and I Want One Of Those, and
should be well-poised to profit from improved economies
of scale in their internet trading, which already accounts
for 29% of sales.
Findel
shares are up 42% on the year, which suggests investors
feel confident in new CEO Patrick Jolly's ability to keep
up the momentum.
One
to buy, says The Times.
Sell
Hornby
While
its sentimental appeal is strong, the Sunday Telegraph has
a number of reservations about Hornby's near term trading
prospects.
Hornby
is highly dependent on strong Christmas trading, especially
so as sales this year have been down 3%, against a forecast
increase of 9%. While there don't look to be any long term
problems, Hornby does currently look a little dear at 17
times forecast earnings.
It could
be a good time to take profits and review the situation
again in six months.
Avoid,
says the Sunday Telegraph.
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