Sunday tips round-up: SSE, Compass, Tate & Lyle

24th May 2009 10:17

Shares in Scottish & Southern Energy are not going to leap and make you rich. There is likely to be a slow progression in its share price. There is one reason and one reason alone to hold the shares - and that is for a steady income stream and because of its commitment to a progressive dividend, SSE shares are a definite buy says the Telegraph.Catering group Compass recently posted a reassuring set of interim figures. The company continues to benefit from restructuring efforts, new contract wins, acquisitions and the weak pound. On a current year earnings multiple of 12.7 times and yielding 3.6%, buy says the Telegraph.With net debt of about £1.25bn, the balance sheet at Tate & Lyle is under strain and few investors believe that Tate's current dividend is sustainable, in the medium term. There is also a wider strategic question awaiting the attention of new chief executive Javed Ahmed, who succeeds Iain Ferguson, pictured, in the autumn. Will he demerge Tate's US corn mill operations from the European sugar and ingredients business? Splitting the company in two looks like a no-brainer to shareholders, but only when and if market conditions return to normal. Hold says the Observer.Petrofac's recent trading update indicated it had more than doubled its order book, which stood at $8.2bn (£5.1bn) at the end of April, after its core engineering and construction unit won $5bn in new contracts in the first quarter. This is a staggeringly impressive performance and provides good earnings visibility all the way out to 2011. The shares remain a buy says the Telegraph. 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.