Thursday tips round-up: Imperial Tobacco, Petropavlosk, Gulf Keystone

23rd Sep 2010 06:44

While close rival British American Tobacco (BAT) has seen its shares climb 18.5pc since the turn of the year, Imperial was down 3.5% heading into the company's trading statement on Wednesday. Against that backdrop, a lack of bad news was well received. Net tobacco revenues are forecast to be 3% higher - in line with management expectations - as the company benefits from growing demand for loose cut tobacco. Buy, says the Telegraph's Questor.The Times makes a similar point. Imps, most of whose brands are at the value end of the market, has tended to trade on a discount of as much as 25 per cent in eps terms against its peers, while yielding about the same, about 5 per cent in the financial year about to start. There seems no compelling reason for that discount to lessen, it says.There is a touch of the hokey-cokey about the decision by Petropavlovsk to float its non-precious metals business IRC on the Hong Kong stock exchange. The mines have yet to turn a profit. But the argument is that, as IRC, it will be more acceptable to Chinese investors, as that country is the buyer of most of the ore. The deal leaves Petro as a pure gold play again. JP Morgan Cazenove, having stripped out all the non-gold assets, has it on an undemanding forward multiple of 9.5, notes the Times.Investors in the oil group Gulf Keystone have had a splendid few months, seeing the stock jump by more than 85 per cent, after Gulf hailed finds at its Shaikan block as transformational. The shares may not jump forward as they have in recent months, but the Independent still believes investors will make money. Buy, it says.Burst Media, a US online advertising sales group, has heard a few popping sounds itself over the summer, especially after it was forced to warn on profits. Altium Capital believes it will have to have a strong final quarter to hit full-year expectations, and may hit profit next year, putting it on a price of two times full-year 2011 earnings. The Independent recommends staying away.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.