LONDON (ShareCast) - De La Rue is definitely worth a punt. The company has returned the nearly £500m to shareholders over the last four years and, according to watchers at Panmure Gordon, "there is still a thriving business on top of that".
The group, which prints bank notes for the UK and other countries, announced full-year numbers yesterday, with profits up 23.7%. De La Rue is a solid growth stock and about as defensive as they come. Buy says the Independent.
On 16 times 2008 earnings, De La Rue shares appear fully priced. Hang on for the special dividend – due in September, which should provide a floor until then – before taking stock again, says the Times.
Grainger is a residential housing group that owns about 20,000 homes across the UK and more in Germany. Sadly, with more mortgage companies cutting lending companies like Grainger will suffer. When the market improves, investors should back the stock, but now is not quite the time. Hold says the Independent.
How Daily Mail and General Trust must rue not selling its Northcliffe local newspapers to Gannett a couple of years ago. The allure of a ten-year low in the shares, which at 400p sit at less than eight times current-year earnings and yield 4%, fails to outweigh formidable cyclical and structural pressures and £1bn of debt. Avoid says the Times.
Property group Invista European's management has given warning that higher than anticipated debt finance costs make it unlikely the dividend will be covered by cash this year. The biggest hope for investors lies not in a superficially appealing 11% dividend yield, helped by a strong euro, or an enticing 46% discount to net asset value, but in so-far forlorn hopes of consolidation in an overcrowded sector. Invista is best avoided reckons the Times.
Given its burgeoning international revenues, well-regarded multi-channel business and sales growth to come from ELC shop-in-shops in out-of-town Mothercare stores, the retailer's shares still look a safe bet, particularly if the consumer downturn improves next year and investors return to retail. Buy says the Independent.
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