Sunday newspaper share tips

By THIS IS MONEY
Updated:

 

Mail on Sunday

Majestic Wine has recovered from a dip in its share price in the spring and is entering the key Christmas trading season in good shape.

Yet despite recent talk that business is booming, fears persist that margins will be squeezed by supermarkets doing festive deals and promotions. Sell at 258½p.

Evidence of a stagnating property market is mounting and housebuilders are having to increase the incentives on offer to encourage people to buy. In the sector, Bellway Homes looks attractive and in 2004 completed its 13th consecutive year of organic growth.

It builds inexpensive houses and also has a large land bank in east London that could benefit from the hosting of the 2012 Olympics nearby. Buy at 875½p.

The Business

European Home Retail is the new name for home shopping group Kleeneze and now has a more balanced business in catalogues, TV shopping and the internet.

The newer operations will take time to evolve but the benefits should be visible in the next two years. With profits upward of £6.3m this year and £8.4m next year expected by brokers, the shares look cheap at 121p.

Shares in Brady, a software house specialising in commodities trading systems, have suffered from delays in contracts which led to a profits warning recently.

But it should be noted that commodities trading is booming, fuelled by strong demand from China, and there are new regulatory requirements that are driving upgrades of existing systems.

With the company worth £14m and with £4m in cash on the balance sheet, the punishment endured by its share price looks much too severe. Buy at 39p.

The Sunday Telegraph

Doorstep lender Provident Financial has been under a cloud due to problems at its Yes Car Credit business, which gives people on low incomes finance to buy cars.

Last month, Provident reported lower-than-expected interim profits of £82.9m because of Yes, but there are also threats to its core business. City broker Teather & Greenwood points out that the home credit mark is at risk from higher fuel and utility prices, which are stretching borrowers' incomes. Sell at 627p.

Songbird Estates, the Aim-listed holding company for Canary Wharf, said last week that the value of its assets had jumped to 156p a share. This is higher than the 100p that was attached to each of its shares when it listed in June last year.

Because of the leveraged nature of financing the Canary Wharf deal, it is likely that the underlying value of the property is even higher than current levels. Buy at 150p.

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