The Week In Review: Cyber beauty still working her magic for SCI

Lara Croft is once again working her magic for SCIEntertainment. The computer game publisher said this week that sales of Tomb Raider Legend, its latest release featuring the cyber beauty, had hit a record 2.9 million since its launch.

With the acquisition of its rival Eidos now integrated, there looks to be little holding SCI back. The positive trend for Lara Croft should continue for some time as Tomb Raider Legend is launched on the Nintendo DS, Gameboy Advance and Gamecube consoles later this year.

Over the past six weeks, the shares have fallen nearly 15 per cent and now trade a just 14 times forward earnings. That is a 45 per cent discount to Ubisoft, its closest peer, and unjustified. Buy.

TT ELECTRONICS

A slew of new products launches is behind booming sales at TT Electronics. At 182.25p, the group's shares trade at just 14 times forward earnings. Although TT is quite vulnerable to a slowdown in the global economy, the potential of its new products outweighs this risk. A dividend yield of 5.5 per cent only adds to its attractiveness. Buy.

ZERGO GROUP

Zergo has built a software platform which facilitates the distribution of mobile phone data irrespective of handset maker or network provider. This week, it unveiled the purchase of Vics, a spin-off from Umist university, in Manchester, which will allow it to distribute video clips to mobile phones along with traditional data. The stock is trading at 32 times forward earnings and despite the strong growth its shares are too expensive. Hold.

ASHTEAD

Ashtead bought US rival NationsRent for $1bn (£540m) this week. The deal creates the third-biggest tool hire company in the US with a market share of about 5 per cent. Although the deal significantly adds to Ashtead's debt, investors need not be concerned. Its shares, which trade at 11 times forward earnings, are worth holding on to.

JD WETHERSPOON

JD Wetherspoon confounded critics this week, issuing a bullish trading statement. Like-for-like sales over the past 12 weeks were up 5.1 per cent, thanks in part to the record-breaking UK temperatures. At current levels, trading at more than 21 times forward earnings, its shares are not cheap. Nevertheless, supporting the stock is the company's impressive cashflows. Hold.

TATE & LYLE

Tate & Lyle said its first-quarter results were well ahead of last year's, mainly thanks to the performance of its Food & Industrial Ingredients Americas business and from sugar trading. The company's long-term growth story is good too, with brokers forecasting the business will deliver comfortable profit growth in every one of the next seven years. Given such potential, the stock should be bought.

BURREN ENERGY

Four years ago Burren Energy was producing 4,900 barrels of oil a day. This week, the group said this figure now stands at 34,000 barrels. Strong performance has put Burren in a great position to continue developing new business opportunities while proceeding with its drilling programme. There may even be scope for cash to be returned to shareholders. Its shares are well below their January peak of 1,100p. Buy.

THORNTONS

Is there a recovery under way at Thorntons? This week's update from the chocolate retailer showed some signs of an improvement. Second half sales fell just 1.8 per cent compared with a decline of 4.8 per cent in the first half. But much now depends on the strategic review being prepared by its new chairman. Should this fail, however, there will be no shortage of bid interest. Hold.

CAPITA

Capita shares were propelled to an all-time this week as the business process outsourcing company posted record interim results. There was also news that the group had secured £806m worth of new business since the start of 2006. In the same period last year it only won £240m. The UK's outsourcing market is worth £4.4bn a year, but analysts estimate it could end up 20 times this figure. Even if they are half right, Capita should continue to enjoy stellar growth for a long-time to come. Its shares are worth holding.

DAIRY CREST

Dairy Crest conceded to investors this week that trading conditions are tough. Rightly, the group believes strong brands are its key to success. It already owns Cathedral City, Utterly Butterly and Country Life and is now trying to brand its milk. This kind of value added portfolio should drive earnings growth for some time to come. The share are a hold.

DIGNITY

Death and taxes are the only sure things in this life. So it's no surprise to see Dignity, Britain's only listed funeral services company, doing well. The group is about to return some £80m to shareholders. Its shares have more than doubled since their April 2004 float and have further to go. This column tipped the shares two years ago at 230p. Now, at 519.5p, they are valued at 16 times 2007 forecast earnings and are still worth buying.

Time to take profits out of London Stock Exchange

A note from Credit Suisse to its clients this week, urged them to reduce their exposure to the London Stock Exchange. The Swiss broker made some very good arguments for selling LSE shares at current levels.

First, it pointed out that the bourse is up against pretty tough comparatives. The exchange's order book volumes enjoyed a 25 per cent rise last year between June and July to £103bn of valued traded. It will struggle to match such a figure this time around.

Second, investors are now fully acquainted with the LSE's growth strategy and its plans to return money to shareholders, and are likely to start asking what more it has to offer soon.

Finally, Credit Suisse highlights the hefty bid premium which is already factored into the group's share price.

Given the focus of the New York Stock Exchange on its merger with Euronext, this leaves Nasdaq as the only potential bidder in town for the LSE, and makes the valuation of the exchange's shares now look undeserved.

At current levels, which see the stock trading at 23 times forward earnings, readers would do well to take their profits at the very least.

m.jivkov@independent.co.uk

The above recommendations are taken from the daily Investment Column.

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

PROMOTED VIDEO
News
The data shows that the number of “unlawfully” large infant classes has doubled in the last 12 months alone
i100Mike Stuchbery, a teacher in Great Yarmouth, said he received abuse
Arts and Entertainment
The starship in Star Wars: The Force Awakens
filmsThe first glimpse of JJ Abrams' new film has been released online
Sport
Rio Ferdinand returns for QPR
sportRio Ferdinand returns from his three-game suspension today
News
The Speaker of the House will takes his turn as guest editor of the Today programme
arts + ents
News
people

Watch the spoof Thanksgiving segment filmed for Live!
Sport
Billy Twelvetrees will start for England against Australia tomorrow with Owen Farrell dropping to the bench
rugbyEngland need a victory against Australia today
Arts and Entertainment
The cover of The Guest Cat – expect to see it everywhere
books
Sport
Tyson Fury poses outside the Imperial War Museum in south London ahead of his fight against Dereck Chisora
boxingAll British heavyweight clash gets underway on Saturday night
News
i100 Charity collates series of videos that show acts of kindness to animals
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

    Austen Lloyd: Company Secretary

    Excellent Package: Austen Lloyd: EAST ANGLIA - SENIOR SOLICITOR LEVEL ROLE** -...

    Citifocus Ltd: German Speaking Client Specialist

    £Attractive Package: Citifocus Ltd: Prestigious asset management house seeks a...

    Citifocus Ltd: Performance & Risk Oversight

    £Negotiable: Citifocus Ltd: This is a varied role focusing on the firm's mutua...

    h2 Recruit Ltd: Sales Director - SaaS (SME/Channel) - £140,000 OTE

    £90000 - £140000 per annum + benefits: h2 Recruit Ltd: Are you a high achievin...

    Day In a Page

    Homeless Veterans Christmas Appeal: ‘We give them hope. They come to us when no one else can help’

    Christmas Appeal

    Meet the charity giving homeless veterans hope – and who they turn to when no one else can help
    Should doctors and patients learn to plan humane, happier endings rather than trying to prolong life?

    Is it always right to try to prolong life?

    Most of us would prefer to die in our own beds, with our families beside us. But, as a GP, Margaret McCartney sees too many end their days in a medicalised battle
    Thomas Cook's outgoing boss Harriet Green got by on four hours sleep a night - is that what it takes for women to get to the top?

    What does it take for women to get to the top?

    Thomas Cook's outgoing boss Harriet Green got by on four hours sleep a night and told women they had to do more if they wanted to get on
    Christmas jumper craze: Inside the UK factory behind this year's multicultural must-have

    Knitting pretty: British Christmas Jumpers

    Simmy Richman visits Jack Masters, the company behind this year's multicultural must-have
    French chefs have launched a campaign to end violence in kitchens - should British restaurants follow suit?

    French chefs campaign against bullying

    A group of top chefs signed a manifesto against violence in kitchens following the sacking of a chef at a Paris restaurant for scalding his kitchen assistant with a white-hot spoon
    Radio 4 to broadcast 10-hour War and Peace on New Year's Day as Controller warns of cuts

    Just what you need on a New Year hangover...

    Radio 4 to broadcast 10-hour adaptation of War and Peace on first day of 2015
    Cuba set to stage its first US musical in 50 years

    Cuba to stage first US musical in 50 years

    Claire Allfree finds out if the new production of Rent will hit the right note in Havana
    Christmas 2014: 10 best educational toys

    Learn and play: 10 best educational toys

    Of course you want them to have fun, but even better if they can learn at the same time
    Paul Scholes column: I like Brendan Rodgers as a manager but Liverpool seem to be going backwards not forwards this season

    Paul Scholes column

    I like Brendan Rodgers as a manager but Liverpool seem to be going backwards not forwards this season
    Lewis Moody column: Stuart Lancaster has made all the right calls – now England must deliver

    Lewis Moody: Lancaster has made all the right calls – now England must deliver

    So what must the red-rose do differently? They have to take the points on offer 
    Cameron, Miliband and Clegg join forces for Homeless Veterans campaign

    Cameron, Miliband and Clegg join forces for Homeless Veterans campaign

    It's in all our interests to look after servicemen and women who fall on hard times, say party leaders
    Millionaire Sol Campbell wades into wealthy backlash against Labour's mansion tax

    Sol Campbell cries foul at Labour's mansion tax

    The former England defender joins Myleene Klass, Griff Rhys Jones and Melvyn Bragg in criticising proposals
    Nicolas Sarkozy returns: The ex-President is preparing to fight for the leadership of France's main opposition party – but will he win big enough?

    Sarkozy returns

    The ex-President is preparing to fight for the leadership of France's main opposition party – but will he win big enough?
    Is the criticism of Ed Miliband a coded form of anti-Semitism?

    Is the criticism of Miliband anti-Semitic?

    Attacks on the Labour leader have coalesced around a sense that he is different, weird, a man apart. But is the criticism more sinister?
    Ouija boards are the must-have gift this Christmas, fuelled by a schlock horror film

    Ouija boards are the must-have festive gift

    Simon Usborne explores the appeal - and mysteries - of a century-old parlour game