Tuesday tips round-up: Tesco, Dixons, Petra Diamonds

11th Sep 2012 07:07

The Independent's Investment View column recommended to 'steer clear' of supermarket giant Tesco on Tuesday morning ahead of its half-year results on October 3rd. The paper says that the results 'will not be pretty' with the focus likely to be on the UK business which accounts for around three-fifths of total operating profit and sales - this division seems to be recovering after a period of falling underlying sales.Shares are well away from the 385p level seen before the profit warning in January, though they have recovered by more than 15% since, dipping below 300p at the end of May. Nevertheless, they trade at 9.9 times forward earnings, broadly in line with sector peers Morrisons and Sainsbury's.While the paper highlights the growing dividend which may attract potential investors, it says that it cannot recommend to buy Tesco shares in the short-term, particularly after the recent spike. Investment View said: "For now we think it is fairly priced and should be left alone for a while to come. Hold."The Tempus column in The Times has hailed PC World and Currys owner Dixons Retail as one of the 'last men standing' in its retail sub-sector and celebrates its resilience in spite of troubles on the High Street. Trading in Britain and Northern Europe is "not as bad as it might have been", the paper says, but sales in Southern Europe have faltered. "As the high street contracts, it is in the interests of suppliers to keep the survivors going and this will be reflected in the terms they are offered," the column said.While the columns says that the shares, trading at around 16 times prospective earnings, are not a "raging 'buy'", at least some of the firm's problems are being tackled.Tempus has also taken a look at Petra Diamonds, the world's sixth-biggest diamond producer, which has put three of its older mines up for sales to concentrate of the remaining five.This year has been tough for diamond miners, the paper explains, with the price of rough stones having fallen by around 30%. Petra expects them to remain at least stable for the rest of the year before recovering in 2013 as the big producers haul back on production."The shares have almost halved since the spring. At 99.5p, they remain a speculative punt on the rate of recovery in the price," Tempus said.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.BC