Sunday tips round-up: REG, Randgold Resources, Tesco

11th Oct 2009 11:46

Brokers estimate that the farms that wind farm operator Renewable Energy Generation already runs are worth £30m while those it intends to construct in the next few months are valued, even now, at about £13m. Add in the £50m-of cash that the company will have once the Canadian sale is completed and REG is worth some £93m, even without ascribing any value to the oil business or the sites for which REG hopes to receive planning permission. Today, REG shares are trading at 60p, making the company worth £60m on the stock market. The shares are undervalued. Buy says the Mail on Sunday.The Sunday Telegraph suggests the gold price may have got slightly ahead of itself. Randgold Resources shares move with the gold price. They have been propelled ahead by recent events and are now sitting close to their all-time highs. Friday's closing price represents a gain of 38% since April. Of course, all gold mining shares are impacted by movements in the gold price, but Randgold is very sensitive because of the heady multiple on which it trades. Take profits, the paper recommends.Indian mining group Vedanta issued an upbeat production report last week. The company revealed that it had significantly upped production at the majority of its operations in the second quarter. However, Vedanta share appear to be up with events. The shares are up an impressive 298pc since December last year, so the stance is hold, says the Sunday Telegraph.Tesco's interim results last week showed just how resilient the group's business model is during turbulent times. Tesco's current-year multiple is 12.9 times, William Morrison is trading on 13.6 times and Sainsbury is the highest rated in the sector at 13.7 times current-year earnings. However, Sainsbury's shares are supported by their slightly higher yield,but Tesco remains the preferred sector play because of the international growth profile and the prospects for Tesco Bank. Shares in Tesco remain a buy says the Telegraph.Early last week, Novera received a takeover bid at 62p a share. The offer came from its largest investor, Infinis, which is the green energy division of private equity firm Terra Firma, owned by entrepreneur Guy Hands.Novera has rejected Infinis, saying 62p a share undervalues the company. Brokers agree, but a rival offer is unlikely given that Infinis has such a big stake.Novera shares are trading at 66.75p, suggesting investors might be lucky enough to squeeze a few more pence out of Infinis. There is no harm in watching the situation develop over the next few weeks, but shareholders should be prepared to sell at or near the current price, the Mail on Sunday suggests.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.