Friday tips round-up: IMI, Persimmon, Bluebay

23rd Apr 2010 06:51

Five months after above-forecast profits prompted it to bring forward its trading statement, IMI is at it again. The mid-cap maker of valves and hydraulic controls yesterday broke its silence two weeks earlier than planned, telling the stock market that its outlook for the first-half of 2010 has "materially improved" since last month's full-year results.Analysts raised profit forecasts by an average 15%, and IMI's shares rose 6% close to their highest price. At 680p, the shares have more than doubled on the year. Even so, a forward multiple of 11 times 2010 earnings still feels too low for a company where operating margins, at 15%, have already reached their pre-credit crunch peak. Hold on says the Times.Severe Services and indoor climate should return to growth next year and the Fluid Power division's strong performance is expected to run and run. On Numis' valuation of 10.4 times 2010 earnings, there should be some value in the shares in the medium term. That being the case, IMI is a buy adds the Independent.Housebuilder Persimmon yesterday reporting steady progress since last month's full-year results. Total sales are up 20% year-on-year to £1.15bn which, given an 11% rise in sales volumes, implies that the company is enjoying price rises, too. Further, cancellation rates remain at "historically low" levels. At 480p, up 14¼p ? or 18 times 2011 earnings, and a premium to historic asset value excluding goodwill ? the shares are up with events. Pass says the Times.Its business is distributing books, newspapers and magazines but Smiths News is best considered a low-risk utility rather than a small-cap services provider geared to the media's fluctuating fortunes. At 113½p, down 4½p, the shares trade at less than eight times current-year earnings. But it is the appeal of a solid 6.5% dividend yield that makes the shares a buy, the Times reports.Bluebay Asset Management, the fixed-income fund house, has had a good quarter, with estimated assets under management jumping by almost 8% in the three months to the end of March. But the really good news was in the detail, with strong sales of emerging market funds. Net inflows over the quarter totalled $3.1bn, of which $846m was down to these. There's value here. Buy says the Independent.Diageo has a quality portfolio - arguably one of the best of any spirits group in the world. Diageo is the world's largest spirits maker, and it has eight of the world's top 20 brands. It also owns Guinness and Tanqueray. However, one of the company's largest brands, Jose Cuervo tequila, is manufactured and distributed under licence. Trading on a June 2011 earnings multiple of 14.6 and yielding 3.4%, the shares remain a buy says the Telegraph.Yesterday's numbers from Anglo American show that the company has outflanked some of its rivals. Anglo trades on 22.5 times full-year earnings, in line with rivals. The only concern is that Anglo does not pay a dividend. At yesterday's AGM, chairman Sir John Parker said the board would expect to be able to rectify this in the current financial year. So no reason not to buy says the Independent.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.