| CATEGORY: TIPS ROUND-UP SECTOR: TRAVEL & LEISURE |
Wednesday tips round-up: Intercontinental Hotels, BG, |
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Wed 18 Feb 2009
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LONDON (SHARECAST) - Looking at yesterday’s full-year announcement from Intercontinental Hotels, the world’s biggest hotelier, investors would be right to be nervous.
The last three months of 2008 saw revenue-per-room, a key indicator, fall by 6.5%, compared with a 4%increase in the first half. Overall, there is little joy for any investment in the hotel sector. Take the opportunity to get out. Sell says the Independent.
It is still far too early to call an end to the revpar decline and the pipeline of new rooms will, inevitably, slow, but once the hotel industry does start to recover, albeit at the tail end of a wider economic upturn, IHG should be first out of the blocks. A solid long-term hold says the Times.
Pennon, which made it to the FTSE 100 a few weeks ago, had more reason to cheer yesterday as it reported a steady-as-she-goes trading performance since the start of October. The group is divided into two groups: South West Water and Viridor, a waste management and renewable energy group. Brokers suggest Pennon is currently trading at a 7.8% discount to [regulated asset base], versus Severn Trent at a 9.9% discount and United Utilities at 6.9% discount.” Buy says the Independent.
Yesterday saw an impressive set of full-year results from the collagen products producer, Devro, which showed a 16% jump in pre-tax profits and a hike of 3.6% in the share price. The food sector and Devro are a good punt. Buy says the Independent.
The cloud on Devro's horizon is the pension scheme, where, amid market falls, the deficit grew from £7.4m to £25.8m. Extra contributions are needed. Investec, the house broker, which is thought to be planning an upgrade, was expecting 2009 pretax profits of £17.2m before yesterday, translating to earnings per share of 7.4p. On a forward multiple of just under 12 times, probably about right for now suggests the Times.
Raven Russia, a warehouse developer, is raising money by issuing convertible preference shares and warrants. Its biggest shareholder, Invesco, is buying £75m of these and, with a conversion price of 25p each, a substantial premium to Monday’s close, it should set a theoretical floor under Raven Russia’s share price. One to watch says the Times.
BG shares are currently trading on a December 2009 earnings multiple of 14 times, which is a premium to BP shares on 8.7 times and Royal Dutch Shell on 8.4 times, but this represents the company's superior growth profile. The shares remain a buy and a core energy holding says the Telegraph.
Full-year results from Croda were excellent. The group upped its full-year dividend payout by 25% to 19.74p, which leaves the shares trading on an historic yield of 3.9%. Still a buy says the Telegraph.
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| IHG - InterContinental Hotels Group |
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| Latest Prices |
| Name |
Price |
% |
| InterContinental Hotels Group |
1,046.00p |
+0.29% |
| BG Group |
1,084.00p |
+0.56% |
| Croda International |
1,340.00p |
+2.45% |
| Devro |
236.30p |
-0.30% |
| Pennon Group |
589.50p |
+0.86% |
| Raven Russia |
49.50p |
+2.06% |
| |
| FTSE 100 |
5,371 |
+0.09% |
| FTSE 250 |
10,141 |
+0.80% |
| FTSE 350 |
2,835 |
+0.18% |
| FTSE AIM 100 |
3,212 |
+0.53% |
| FTSE AIM All-Share |
702 |
+0.72% |
| FTSE All-Share |
2,773 |
+0.20% |
| FTSE Small Cap |
2,840 |
+0.87% |
| FTSEurofirst 300 |
1,055 |
-0.08% |
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