Thursday tips round-up: Randgold, Ferrexpo, Time Warner

8th Aug 2013 06:41

Randgold Resources saw its profits fall as the company adjusted to a drop in gold prices, The Telegraph's Questor column mused. However, Chief Executive, Mark Bristow, said the group will remain profitable despite the fall in price of the precious metal. Production was little changed compared with the first quarter, at 196,000 ounces, but cash costs were cut by 5.0 per cent to 795 dollars an ounce. Costs were, however, ahead of the equivalent quarter of last year. Some analysts were disappointed with the flat production, as they had expected an improvement. Yet Randgold has one of the strongest balance sheets in the gold sector, with no debt, 200m dollars of banking facilities in place and 45m dollars of cash in the bank. Operationally, Randgold continues to progress well, but the gold price is likely to remain volatile. Shares have almost been tracking the gold price so Questor recommends a 'hold' rating.FTSE-250 iron ore miner Ferrexpo's half-year results showed a push-pull between increased production and the lower price achieved because of weaker demand from customers in China, The Times' Tempus column said. Production was ahead by 11% to 5.3m tonnes of iron ore pellets in the first half. Achieved costs were off by 6.0% to about $139 a tonne. Production costs per tonne rose in the first quarter because of the ramp-up of the Yeristovo mine in the Ukraine but then flattened off again. Revenues rose 6.0% but earnings before interest and other one-offs were flattish, up 1.0% to $244m. The company has maintained dividend payments through the recession, perhaps because one shareholder, a local billionaire, owns 51%. The shares, up 21.50p to 185p sell on about 7.7 times' earnings, which looks reasonable given the potential for growth but investors should be cautious of political risk and iron ore prices.Time Warner's release of blockbusters, Man of Steel, The Hangover Part III and The Great Gatsby boosted film and television revenues by 13% in the second quarter, the Financial Times' Lex column noted. A 7.0% increase for the networks division came with higher advertising revenues around the NBA playoffs while Game of Thrones' third season had the second-highest viewership ever for an HBO series. While things are looking up at Time Warner between the earnings and raised guidance, the quarter at rival Walt Disney was less of a smash. Its third-quarter earnings slightly beat expectations on the strength of ESPN and its theme parks, but the company warned this week that its disastrous Lone Ranger remake would result in a loss of up to $190m by itself. Time Warner also needs to keep in mind that if growth does not pan out or the hits stop coming, its fans in the stock market could become underwhelmed.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.