The Week in Review: Any buyers should steel themselves

Avis Europe

Avis Europe is buying the rights to the Budget brand in Europe, the Middle East and Africa, for £25m, gaining an instant royalty stream of £10m a year. Yet there are reasons to be wary. Avis was unable to say when the acquisition might enhance earnings. There are cost savings, but Budget may win market share from, er, Avis itself. There will be better times to buy Avis. Sell.

Colefax

Colefax, purveyor of designer fabrics to Britain's country houses of Britain, has found nervousness at the top end of the housing market is eating into sales. Pre-tax profit in the six months to 31 October was £1.65m compared to £1.64m in 2001, which included the effects of 11 September. Underlying profits are falling sharply. Sell.

Thorntons

The high street confectioner had a disappointing Christmas. Thorntons has shut a few stores and improved products, but it is unclear how much more can be squeezed from its 390 stores. There are better long-term growth prospects in the "commercial" division, which sells in Marks & Spencer and Tesco. Valentine's Day, Mother's Day and Easter may prove Christmas was an aberration, but the shares look expensive. Best avoided.

Cookson

In the short run, things have improved. It sold more businesses for £50m, the banks are off its back, debt at the end of 2002 was less than £400m, and cashflows have been stronger than the City expected. The issue is when over-capacity in the electronics industry will be worked through. Little evidence suggests an upturn yet. For hardened gamblers only.

Sanctuary

Dolly Parton, The Strokes, Iron Maiden and Alison Moyet are all making sweet music for Sanctuary Group. Not that much of this has been reflected in the share price. Underlying profits in the year to September rose 25.6 per cent to £14.2m. The bear case for Sanctuary is that an Iraq war could force the cancellation of rock tours, as after 11 September. The bull case is a proven business model with a possible Led Zeppelin tour later this year. Good long-term value.

CodaSciSys

There are hidden gems in the software sector, and the excruciatingly named CodaSciSys is one of them. The company grew out of the European space programme in the Eighties and has an unbroken record of profit growth for more than a decade. The group is growing sales despite a recession in the software industry that looks like entering its third year. The shares are a buy.

Stanley Leisure

A few years ago, a night out in one of Stanley Leisure's casinos was about as exciting as a game of Old Maid. But Bob Wiper, the group's shrewd head croupier, has changed all that. New games, such as the ancient Chinese dice game Sic Bo and electronic roulette, have been rolled out across the 37 provincial casinos, as has a revamped food and drink offering. This, and a strong showing from London casinos including Crockfords, helped operating profits at the division to smash expectations, soaring by 50 per cent to £21.8m for the six months to 27 October. After playing a poor hand in its quest to secure a tie-up with its rival London Clubs International, Mr Wiper is keeping his cards close to his chest regarding its interest in LCI's Palm Beach and 50 St James casinos, which are up for sale. Takeover rules may mean LCI is off the group's radar for six months, but Mr Wiper will clearly be back. The stock has been a winner since this column last tipped it 18 months ago, and deserves its premium rating of 14 times earnings. The prospect of further deregulation means Stanley could attract attention from overseas predators. Buy on any weakness.

St James's Place Capital

When even rich people haven't enough money to invest in the stock market, times get tough for St James's Place Capital, the upmarket insurer and wealth manager. Sales in 2002 were down 22 per cent, and down 29 per cent in the last quarter. St James's Place sells through 1,000 self-employed salesmen, who are partners in the business. It wants a further 100 by the end of the year. But even with an increased sales force its fortunes are inextricably bound to the stock market. The shares are only on a p/e of 10. But with a market rally unlikely they are best avoided.

Misys

Misys, the software firm, showed there is life in this difficult sector this week with profits up 16 per cent and a sharp rise in the share price.

Its healthcare division, which provides IT systems to doctors and hospitals was the star performer and helped counter the tough conditions hitting the other parts of its business. The company's main profit generator – its banking division -- has had a tough time. Revenues fell 9 per cent to £140m, although profits were more or less flat at around £27m, as customers continue to take a cautious approach to spending on IT. A p/e of 11 does not seem demanding but until signs emerge that banks are starting to splash out on IT systems again the stock is only a hold.

Independent Partners; request a free guide on NISAs from Hargreaves Lansdown

News
peopleHowards' Way actress, and former mistress of Jeffrey Archer, was 60
Sport
Romelu Lukaku puts pen to paper
sport
News
Robyn Lawley
people
Arts and Entertainment
Unhappy days: Resistance spy turned Nobel prize winner Samuel Beckett
books
PROMOTED VIDEO
News
people
Life and Style
Troy Baker and Ashley Johnson voice the show’s heroes
gamingOnce stilted and melodramatic, Hollywood is giving acting in video games a makeover
News
i100
Life and Style
Phones will be able to monitor your health, from blood pressure to heart rate, and even book a doctor’s appointment for you
techCould our smartphones soon be diagnosing diseases via Health Kit and Google Fit?
News
people
Extras
indybest
Travel
Ryan taming: the Celtic Tiger carrier has been trying to improve its image
travelRyanair has turned on the 'charm offensive' but can we learn to love the cut-price carrier again?
Sport
Usain Bolt confirms he will run in both the heats and the finals of the men's relay at the Commonwealth Games
commonwealth games
Life and Style
Slim pickings: Spanx premium denim collection
fashionBillionaire founder of Spanx launches range of jeans that offers 'thigh-trimming construction'
News
Sabina Altynbekova has said she wants to be famous for playing volleyball, not her looks
people
News
i100
Life and Style
tech'World's first man-made leaves' could use photosynthesis to help astronauts breathe
Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Senior Investment Accounting Change Manager

    £600 - £700 per day + competitive: Orgtel: Senior Investment Accounting Change...

    BA/PM,EMIR/Dodd-Frank,London,£450-650P/D

    £450 - £650 per day + competitive: Orgtel: My client, a leading bank, is curre...

    Senior Analyst - ALM Data - Banking - Halifax

    £350 - £400 per day + competitive: Orgtel: Senior Analyst, ALM Data, Halifax, ...

    Java developer - Banking - London - Up to £600/day

    £500 - £600 per day: Orgtel: Java developer - Banking - London - Up to £600/d...

    Day In a Page

    Save the tiger: The day America’s love of backyard tigers led to a horrific bloodbath

    The day America’s love of backyard tigers led to a horrific bloodbath

    With only six per cent of the US population of these amazing big cats held in zoos, the Zanesville incident in 2011 was inevitable
    Samuel Beckett's biographer reveals secrets of the writer's time as a French Resistance spy

    How Samuel Beckett became a French Resistance spy

    As this year's Samuel Beckett festival opens in Enniskillen, James Knowlson, recalls how the Irish writer risked his life for liberty and narrowly escaped capture by the Gestapo
    We will remember them: relatives still honour those who fought in the Great War

    We will remember them

    Relatives still honour those who fought in the Great War
    Star Wars Episode VII is being shot on film - and now Kodak is launching a last-ditch bid to keep celluloid alive

    Kodak's last-ditch bid to keep celluloid alive

    Director J J Abrams and a few digital refuseniks shoot movies on film. Simon Usborne wonders what the fuss is about
    Once stilted and melodramatic, Hollywood is giving acting in video games a makeover

    Acting in video games gets a makeover

    David Crookes meets two of the genre's most popular voices
    Could our smartphones soon be diagnosing diseases via Health Kit and Google Fit?

    Could smartphones soon be diagnosing diseases?

    Health Kit and Google Fit have been described as "the beginning of a health revolution"
    Ryanair has turned on the 'charm offensive' but can we learn to love the cut-price carrier again?

    Can we learn to love Ryanair again?

    Four recent travellers give their verdicts on the carrier's improved customer service
    Billionaire founder of Spanx launches range of jeans that offers

    Spanx launches range of jeans

    The jeans come in two styles, multiple cuts and three washes and will go on sale in the UK in October
    10 best over-ear headphones

    Aural pleasure: 10 best over-ear headphones

    Listen to your favourite tracks with this selection, offering everything from lambskin earmuffs to stainless steel
    Commonwealth Games 2014: David Millar ready to serve up gold for his beloved Scotland in the end

    Commonwealth Games

    David Millar ready to serve up gold for his beloved Scotland in the end
    UCI Mountain Bike World Cup 2014: Downhill all the way to the top for the Atherton siblings

    UCI Mountain Bike World Cup

    Downhill all the way to the top for the Atherton siblings
    Save the tiger: The animals bred for bones on China’s tiger farms

    The animals bred for bones on China’s tiger farms

    The big cats kept in captivity to perform for paying audiences and then, when dead, their bodies used to fortify wine
    A former custard factory, a Midlands bog and a Leeds cemetery all included in top 50 hidden spots in the UK

    A former custard factory, a Midlands bog and a Leeds cemetery

    Introducing the top 50 hidden spots in Britain
    Ebola epidemic: Plagued by fear

    Ebola epidemic: Plagued by fear

    How a disease that has claimed fewer than 2,000 victims in its history has earned a place in the darkest corner of the public's imagination
    Chris Pratt: From 'Parks and Recreation' to 'Guardians of the Galaxy'

    From 'Parks and Recreation' to 'Guardians of the Galaxy'

    He was homeless in Hawaii when he got his big break. Now the comic actor Chris Pratt is Hollywood's new favourite action star