Sunday newspaper share tips

By THIS IS MONEY
Updated:

 

Each week we round up the Sunday newspaper share tips and the views of the mid-week tipsters too.

For the Mail on Sunday's stock picks read the Midas column. And check out our review of the mid-week share tips.

Sunday Telegraph

Finnish company Powerflute - a holding company set up to fund turnaround opportunities in the paper and packaging industry - is making a name for itself in the sector.

The group, which has secured Ireland's Smurfit paper dynasty supremo Desmond Smurfit as its chairman, has notched up an impressive performance with its first purchase, a Finnish paper mill in 2005. The acquired venture has since seen production volumes increase by 25%, head count reduced by 30% and has been transformed from a loss-making business into one of the most successful paper mills. Having recently listed on the Alternative Investment Market, shares are now available to retail investors. A buy at 114½p.

South African IT services company Dimension Data caught some investors out when the dot com bubble burst in 2000. Shares were then 580p each and are now just 53p. But the group has survived the cull and is worth a second look. Its client list includes corporate heavyweights such as Google, BMW and Pfizer. Dimension Data also recently posted better than expected interim results with earnings up 50% and an improved profit margin. Alongside a compelling case in the figures, the firm is also growing internationally, with ventures in Africa and Australia proving a success so far. A buy for investors. The Sunday Times

Northumbrian Water shares are cheap, at 324¾p, for a firm operating in a sector that has real potential over the coming years. The Competition Commission's decision to approve the merger of Mid Kent Water and South East Water gave hope for a raft of similar mergers, with water firms and water and sewage groups the most likely contenders. The high price tags achievable by these groups is also an exciting prospect, with the 25% premium to assets paid for Anglian Water Group indicative of the cash that infrastructure funds are willing to pay.

Northumbrian Water could attract some equally flush suitors, not least because of its financial performance - a 17% rise in interim profits and solid full year figures forecast when the group reports next month. The group has also an often overlooked jewel in its crown, having secured a Government contract to run Kielder Water, which is the largest reservoir in Britain. Regardless of any takeovers or mergers, the company's prospects speak for themselves.

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