Friday tips round-up: LSE, Anglo American, PepsiCo

19th Jul 2013 06:47

London Stock Exchange's shares are up 46 per cent this year, sitting at a five year high, The Telegraph's Questor noted. The share-price performance reflects the success the company has had in repositioning across the financial market. The company beat expectations on Thursday in its first quarter revenues following the acquisition of clearing house LCH.Clearnet which contributed to results. However, there was good growth across most businesses, with revenue jumping 8.0 per cent on an organic, constant currency basis. While their strategy is sound, the shares are looking fully valued for now. "The premium is justified, but the rating is now 'hold' from 'buy'," Questor said.Since Mark Cutifani became Chief Executive of Anglo American in April, he has been reviewing various assets. He will give the results of his review in a week with halfway figures. "At Anglo the task has been especially pressing because the miner has been facing a number of unrelated issues that have come, unhelpfully, at the same time," The Times' Tempus column said. Shares have been in continuous decline since the start of last year. The group still has half its operations in its native South Africa, which is seen as a weakness as its iron ore operations declined and strikes at offset a jump in production from its Kolomela mine. Cutifani has already indicated that he will be pulling back from long-term projects and concentrating on getting the best value from existing ones. Any progress will have to await the results of his review. Nelson Peltz, head of Trian Partners, made a detailed case for a split of PepsiCo's beverage and snack businesses on Wednesday. "His arguments have merit, but leave room for Pepsi's management - which has rejected the idea so far - to mount a feisty defence," according to the Financial Times' Lex column. Peltz argues that the drinks and snacks businesses have different distribution, strategic imperatives and financial profiles which have prevented growth and returns at Pepsi against rivals. However, the disparity between Pepsi's performance and valuation and that of the peers Peltz selects - Coca Cola, Dr Pepper Snapple, Hershey, Mead Johnson and McCormick, among others - could be due to Pepsi's structural problems, or to differences in, for example, product mix. Lex also pointed out that the comparisons Peltz makes on food are unsatisfying. Hershey, Mead and McCormick make candy, baby formula and spices, respectively while Pepsi sells chips and cereal.RDPlease 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.