Apart from oil prices, BG’s shares are likely to remain susceptible to the near-term production outlook – notably the development of the next phase of the Karachaganak field in Kazakhstan – and the progress of its hostile A$14 billion (£6.7 billion) bid for Australia’s Origin Energy.
However, at ten times 2008 forecasts and earnings set to grow at double digits, BG is now in the territory where it could become a target itself. Buy at £10.68, writes the Times.
The FT says that BG's long-term growth prospects still look excellent and bid hopes will limit the downside. But for all their problems, the unloved super-majors may offer better value and have admirable defensive qualities in these turbulent times.
Kingfisher’s shares trade at about 11 times prospective earnings, a slight premium to the sector. But with analysts putting little faith in even short-term earnings forecasts because of the opaque economic environment, such metrics are of questionable use. This is a turnround story and investors should decide whether they have faith in chief executive Ian Cheshire's ability to deliver a better sales mix, cost-cutting and improved central purchasing. Delivering a successful recovery in this environment would, however, test the ability of any board, says the FT.
At 20 times current-year earnings, Capita’s shares may find it hard to appeal to first-time buyers, given the premium to peers. However, long-term contracted revenues linked to inflation and annual forecast earnings growth of nearly 20 per cent over the next two years give ample reason to hold on at 670p, writes the Times.
The FT says that Capita trades at 20 times forecast earnings, among the highest in the FTSE 100. That is a tribute to the quality of the company and its management, but it means there is little upside.
The Telegraph writes that Capita is not cheap on 17 times next year's earnings with a 2.6pc dividend yield. But if you must play the stock market now, it's about as safe as they come. Buy.
Misys is a different company from two years ago. Now it is more outward looking, has new products and is innovating. Emerging markets are robust and the merger with Allscripts gives it the scale to attack the fragmented US healthcare market. So far this progress has not been reflected in the company's share price, with the stock down 30 per cent in the past year, says the FT.
In current conditions, the UK market is currently out of love with most software companies. But it also reflects that the hard part of execution remains and that Misys could not offer any more details on its complex Allscripts deal until the regulatory filings are complete some time in the autumn. The shares trade a full-year 2009 price earnings ratio of 14.4 times, which reflects the market's concerns but little of the potential earnings upside from its turnround.
At 277¼p, BSS shares have fallen 28 per cent since May, to less than eight times forward earnings. With little likely to change that mood, BSS is best avoided, according to the Times.
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