Friday tips round-up: Cineworld, Hays, Prostrakan

8th Jan 2010 06:38

The idea that cinemas boom during a downturn was proved right in 2009, with the annual box office gross takings in the UK breaking through £1bn for the first time. This has had Britain's largest cinema chains rubbing their hands together in glee, with the only listed group, Cineworld Group, publishing a bullish update yesterday.The stock is cash generative and the group believes the line-up for Hollywood in 2010 - crucial for the cinemas' cash registers to keep ringing - is strong. It includes the latest Harry Potter, Shrek 4 and Toy Story 3. At a full year price to earnings ratio of 10.5 times the stock looks cheap and a yield of 6% is an extra bonus. Cineworld looks worth a punt. Buy says the Independent.Persimmon boosted sentiment across the house building sector yesterday. In a trading update ahead of its preliminary results in March, the group said forward sales into 2010 were up 40%. The bulls will no doubt point to the momentum in house prices but economists continue to worry about the possibility of a double dip later in the year. Hold for now says the Independent.ProStrakan is a company on the up. The speciality pharmaceuticals group, which published its full year trading statement yesterday, says that after reporting annual revenue growth of 40%, 2010 will be the company's first year of profitability. The shares trade on an undemanding 2.4 times forecast sales, a discount to the wider market. Buy says the Independent.If 2012 forecasts hold good, ProStrakan's shares, at 101p, trade at a multiple of four times that year's earnings ? or three times cheaper than those of Shire Pharmaceuticals, the FTSE 100 peer from which its management were drawn. Buy on weakness adds the Times.Recruiter Hays's dividend decision will not be disclosed until the end of next month. But a prospective 5.5%yield ? far higher than its rivals ? and long-awaited evidence of recovery means the shares should be held for the payout alone, the Times suggests.Avanti Communications provides satellite broadband services in 14 European countries using rented satellite capacity. However, to make it economic, the company needs its own satellites. This week it secured funding for the second of these. The company's business model looks sound and it is addressing a real need. The Government has an aspiration that all rural areas in the UK will have access to 2Mb broadband by 2012. Avanti is part of that ambitious plan - and the Government provided £24m in funding for the company's first satellite. Buy says the Telegraph.Fund manager Rathbones remains cautious in its outlook, citing the uncertainty created by a general election and the drag on profits from rock-bottom interest rates, which reduces the returns from the client cash it holds on deposit. But at 868½p, or 15 times 2010 earnings, Rathbone's track record of steady growth suggests that premium is deserved. Hold suggests the Times.Please note: Digital Look provides a round-up of news, tips and information that is impacting share prices and the market. Digital Look cannot take any responsibility for information provided by third parties. This is for your general information only as not intended to be relied upon by users in making an investment decision or any other decision. Please obtain a copy of the relevant publication and carry out your own research before considering acting on any of this information.