Lloyds TSB/HBOS says it will pay the 2009 dividend based on a payout ratio of "40% of underlying earnings" - the final this year will be paid in shares.
This is less generous than Lloyds shareholders are used to and has already caused some anger. Analysts reckon the new policy dilutes Lloyds' current yield from 13% to 7%, a cut of around 50%. Analysts suggest that merger benefits could be material, but how much could depend upon the level of Government involvement. The Telegraph's advice is for shareholders to await developments.Hold.
The recent easing in oil prices will add $60m to profits in the final three months of the year against previous expectations for cruise operator Carnival. The flipside is that a stronger dollar will also dent profits – around one third of which are drawn from Europe – by around half that amount. Also,it seems churlish to assume that rising unemployment and the erosion of its customers’ wealth from falling stock markets will leave it wholly unscathed. At 12 times next year’s earnings. Sell says the Times.
Having rallied 44% in two months, Kingfisher shares trade at 12 times next year’s earnings and have done much to anticipate recovery. However, given the capacity of poor trading at home to offset progress overseas, there should be better times to buy. Avoid says the Times.
Kingfisher enjoys a strong market position in the UK and beyond. Factor in the prospects for recovery, the almost £3bn of freehold property and - after the Italy sale - nil net debt and the company is a good long-term bet. Unfortunately, the forward price/earnings multiple of about 12 prices that in, says the FT.
Panceltica has the distinction of being one of the biggest floats on AIM this year and one of the few whose shares trade above their issue price.The group operates solely in the Arabian Gulf, where it builds lightweight steel structures to accommodate the region’s booming population of migrant workers. However, Panceltica’s immaturity and poor liquidity means potential investors should await further progress before buying in says the Times.
Investors in Tate & Lyle will want clarity on the outlook for corn costs and commodity sweetener prices, the two key variables which are likely to impact the 2009/2010 profits outlook, before the shares are able to move beyond their recent trading range. Yesterday's statement as a steady-as-she-goes update, but need a bit more clarity before jumping into the shares. Hold says the Independent.
As Tate insiders were at pains to point out yesterday, the company's trading statement added little that should have shifted investor sentiment and with a dividend yield of 6.5pc the stock has its attractions. That might be true but the tea leaves are too difficult to read. Best avoided for now says the Telegraph.
It is easy to argue that housebuilder cum contractor Kier is one of the strongest names in its sector. Its diversified model, the fact that a lot of work comes from public funds, and its work in the Middle East, which is also state-backed, are all reasons to buy. However, investors need to be very careful in this most dangerous of times. Cautious hold says the Independent.
Kier's housebuilding business remains and exiting it might be tricky with no rival with a balance sheet strong enough to take it off its hands. Analyst forecasts point to lower profits next year and, at best, a flat dividend. That equates to a decent 5.5% yield, but with some hefty downside risk. At nearly 10 times forecast earnings following a recent rally, there is little incentive for new investors to pile in says the FT.
In July, media and training group Wilmington confirmed that it had received an approach, sending the stock soaring, only for it to collapse to its pre-talks level when the group said it is better off on its own. It will take more than yesterday's impressive results to determine whether or not that was a wise move.Investors may wish to be cautious, says the Independent. Hold.
Fund manager BlueBay is better placed than many fund managers as clients switch out of equities to fixed income and diversify into emerging markets. But anything can happen when markets are this choppy. Analysts forecast earnings per share of about 21p in the coming year, putting the stock on a more than respectable price/earnings ratio of about 12 times. But the upside seems likely to be limited, particularly given Lehman's administrators are likely to want to sell the bank's 5% stake says the FT.
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