Friday tips round-up: Derwent London, Close Brothers, Centrica...

19th Nov 2010 06:40

Derwent London, the office landlord, joined the chorus of commercial property companies singing the praises of London's buoyant market yesterday.It is encouraged by the continued improvement" of the market in the heart of the capital, despite economic conditions remaining "uncertain". Rentals are growing in Central London while Derwent's debt is falling and interest rate hedging is in place. So the stock has its good point. But its valuation offers little upside. There is a case for taking profits but for now says the Independent.Close Brothers is and remains something of an oddball, a ragbag of different financial services businesses in one group which is really hard to compare to anything else. The stock has had a good run and at 12 times full-year earnings isn't cheap, but hold for the 5% prospective yield says the Independent.Heritage Oil has published some promising news on a key well in Iraq's Kurdistan region. The Miran West-2 development, it said, beat its target, encountering hydrocarbons at deeper than expected depths. At end September, Heritage boasted a cash pile of $614m excluding reserves. The shares, at 367p, are below broker estimate of 488p per share for the company's risked net asset value, with potential gains from exploration of 120p a share. Buy says the Indpendent.James Fisher's slow improvement is continuing. Fisher's marine oil business, which transports crude, is still profitable and there was continued good progress at its marine services division. The shares trade on a December 2010 earnings multiple of 12.3 times, falling to 11.1 in 2011. The group's business is cyclical and should be re-rated as earnings improve through the cycle. The shares are a buy for a recovery in its markets suggests the Telegraph.British Gas owner Centrica's third-quarter update indicated that everything was on track and the company is delivering on its goals. The shares are trading on a December 2010 earnings multiple of 13.3 times, falling to 12.3 next year. The yield is 4.1%, rising to 4.5% next year, so is attractive for income seekers says the Telegraph.Melrose has not made a purchase since FKI two years ago and nothing is imminent. Regular readers will know that most quoted specialist engineers are leaving the recession in strong health, and are not the sort of eight-stone weaklings Melrose tends to prey on. Analysts were busy upgrading their forecasts yesterday, but the shares are on less than 11 times next year's earnings. Fans of the management strategy should buy says the Times.Even National Grid admits that its accounting is at times impenetrable. The question Grid shareholders will want answered is how safe that dividend is beyond 2012. Hard to say, but the company has huge capital spending commitments of £3.7bn this year, mainly in the UK. There is unlikely to be any repetition of this summer's shock £3.2bn rights issue, but that event alone highlights the uncertainties ahead, says the Times.Norcros interims make clear it is going to be a hard slog from here with little benefit from the market even though the maker of Triton showers and various tiling products has had the benefit of the collapse of one of its biggest tiling competitors. The share price is wedged at a little more than 10p and there seems little reason for any progress short-term says 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.