Wednesday tips round up: Antofagasta, James Fisher and Sons

26th Aug 2015 11:01

(ShareCast News) - The Financial Times' Lex column said one of the reasons behind Antofagasta's lacklustre share performance was its flat dividend pay-out."The market demands miners pay dividends before they don their M&A cap to go hunting for future growth," the newspaper explained.Like other miners, Antofagasta had cut costs and capital expenditure in the wake of China's economic slowdown, Lex added.However, it had also forked out $1bn for half of Barrick Gold´s top-notch Zaldivar copper mine in Chile.On the positive side of things, the column said Antofagasta could still lavish growth capex to ramp up output at its Antucoya mine and other projects if it chose to do so - given its robust balance sheet."That is because Antofagasta has flexibility; its balance sheet is robust and cash flow adequate, despite reduced production in the first half.Unlike many of its rivals the firm has been betting on only a small copper surplus remaining on world markets by the end of the year, instead of coming closer to peak oversupply, opting therefore to maintain its investment drive.The Times' Tempus said investors should hold on to their shares in James Fisher and Sons for the income, despite the marine engineering firm posting a 54% drop in offshore oil work in the first half of the year."Nobody had expected the Barrow-in-Furness-based business to be immune to the plunging oil price but the drying up of work was worse than it had expected," the investment column said.Nonetheless, Tempus emphasised how while offshore oil had already been the growth driver for three years, it was a fairly diversified business."When one wheel slows, another can speed up," Tempus wrote."The company is adept at navigating the choppy waters and with oil rig work in the doldrums other areas are coming to the fore."James Fisher is trading on 15 times earnings, which is cheap, making the stock worth holding for the income.