Date: Friday 08 Jun 2012
In the Telegraph, Questor makes a compelling case for buying Vodafone. Impressive cash generation offers a current yield of 8.5 per cent while the shares trade at just 10 times earnings. Vodafone has also announced a sensible joint venture with O2’s parent company, Telefonica, to share infrastructure costs. For income investors, it seems a fairly straightforward decision: buy
The owner of Costa Coffee and Premier Inn, Whitbread, may eventually sell off its coffee shop chain thinks Tempus in the Times but that could be three to four years away. In the meantime, expansion plans at both businesses look modest, with Costa seemingly unlikely to try and “break” America while Premier Inn hasn’t got big plans outside the UK. The pub-restaurants like Beefeater, are probably lacklustre, although no separate figures are released. Tempus is uninspired, leave.
With a noticeable dearth of company results, Tempus ponders the supermarket scene. His conclusion is that Sainsbury’s and Morrisons are a better buy than long time grocery champion Tesco. This is stirring stuff because since 1995 Tesco has carried all before it but the turnaround plan at Britain’s biggest supermarket chain will not have had much effect in the figures due for release next week, while Sainsbury’s has “powered along” boosted by a high number of store extensions. Sainsbury’s and Morrisons are a buy.
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