Sunday share tips: Rio Tinto, Sage, house builders

1st Dec 2013 16:21

Buy Rio Tinto and Anglo American, the Sunday Times's Simon Duke recommended in the Inside the City column. Both companies are scheduled to make presentations to investors in December. Their current bosses have departed from the big-spending ways of miners in the past and now focus on shareholder value. The industry is highly cyclical and is still in a trough but discipline on capacity should push prices up. Also, Glencore is ready to make acquisitions if either company slips up.Buy Rio Tinto, the Sunday Telegraph's Questor column recommended. The mining group is increasing iron ore production to capitalise on a rise in commodity prices. The question is how much this boost to production will suppress prices but the economy of China, the biggest market for iron ore, is still resilient. Rio is a more efficient company than it was and if prices hold up then profits and Rio's shares can rise. With a 3.6% dividend yield, Rio is a bet on Chinese commodity demand.Sage is unglamorous compared with other technology stocks but it is expected to boost its full-year dividend by 6% to 10.8p a share, Simon Duke wrote in the Sunday Times. The accounting software company's small business clients rarely change their software. This loyalty helped Sage through the recession and is a contrast to the roller coaster world of consumer technology. The fall in housebuilders' shares after the Bank of England (BoE) pulled back on support for mortgage lending is an opportunity, the Sunday Telegraph's Questor column said. The main support for housebuilders' shares has been the Government's Help to Buy programme and not the BoE's Funding for Lending scheme. There is still a shortage of housing that will support the housing market, order books are healthy and dividend yields are attractive. Persimmon and Taylor Wimpey should yield more than 6% for some years. Hold for income, Questor said.Buy Tritax Big Box, the Mail on Sunday's Midas column advised. The company runs massive warehouses that support online sales for big retailers. Logistics is more important to retailers than ever as the best companies rotate stock more quickly and offer one-day delivery. Tritax has been involved in the sector for years but is raising capital on the stock market for the first time. Tritax Big Box shares will float on December 9th at 100p and its experienced team will use the money to buy warehouses. With an expected 6% dividend yield and growth prospects, the shares should reward investors.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.SF