National Grid Transco, the electricity network and gas pipelines business, has high hopes for the five local gas networks tagged for possible sale. The first auction is expected in months and it could crystallise people's views on the worth of the group as a whole. The shares have, disappointingly, drifted lower since the merger last year.
Part of the problem has been the relatively modest dividend, but that too might be coming right, after a 15 per cent hike at the interim stage, a similar rise later this year, then the promise of 7 per cent growth per year until 2008. An investor buying the shares now will have a dividend yield this year of 4.9 per cent, rising to over 6 per cent.
There are more lucrative utility investments, but they do not have the upside potential for the share price, too. NGT is reinvesting the gas distribution sale proceeds in expansion in the restructuring US power market and its stock is cheap. Buy.
The "Ritblat discount" at British Land is as wide as ever. John Ritblat, the property group's chairman and chief executive, has never endeared himself to the Square Mile. He promised to split the top two roles by next summer. The share price should rise as the management issue is resolved and a recovery in rents in the City starts to kick in. Hold.
CeNeS Pharmaceuticals is buying its next- door neighbour in Cambridge, TheraSci, which in turn is buying the rights to a novel sedative to be used as a quick'n'easy anaesthetic for day surgery. CeNeS has a modest but attractive portfolio of well-researched drugs to combat pain. Its most advanced, M6G, is a derivative of morphine, on which the newsflow from here could push the shares higher. Have a punt.
The Wireless Group
The virtues of The Wireless Group often get lost underneath all the bluster from its founder, Kelvin MacKenzie, but it has a sought-after national radio licence for talkSport and is heading for its first profit. The shares may be too expensive for only the bravest speculators for a while, but there is a good chance of a bid. Hold.
Paragon, the buy-to-let mortgage business that caters for professional landlords, has an image problem in the City that means its shares are still cheap. Sure, interest rates have been raised and house-price growth is about to ease. But this should be less of a problem for Paragon than many think. Professional landlords are smart about picking profitable properties. Individuals may also be keener to rent rather than buy until the longer-term direction of prices becomes clear. Buy.
Is the teenage-girl market turning back to cider after its flirtation with alcopops? This is the intriguing question raised by results from Merrydown, the drinks company. Cider sales rose over the summer for the first time in years. The group's fortunes are based on the rate of cider sales growth and, more importantly, its fast-expanding Shloer soft drinks brand. Hold.
Investors who bought in at the flotation of Enterprise Inns, the tenanted pub company, in 1995 have made 10 times their money. Do they stay for a lock-in, or should they call time? It remains a well-managed, conservatively financed and fundamentally simple business, based on collecting rent from its tenant publicans who are tied to Enterprise for their beer supplies. Hold.
Acambis has turned from a shaky biotech outfit into a UK life science sector hot property, thanks to contracts to supply smallpox vaccine to a nervous US government. The company is pumping the cash into other development programmes and is close to filing for regulatory approval of Arilvax, its yellow fever vaccine. Buy and tuck away.
The acquisitive group's businesses now stretch from its core education market (where it runs failing schools, amongst other things) into IT systems development, public relations and management consultancy. Best of all, the management is trusted enough in Government circles to run at least one of the networks of drop-in treatment centres introduced to the NHS. Tribal is a good way to invest in the public services revolution.
Given the choppy stock markets over the past year, it is little surprise Brewin Dolphin, the stockbroker, has had a hard time. With markets increasingly bouyant, the earnings potential for Brewin has improved, but it still has a cloud over it in the shape of the Financial Services Authority's investigation into split-capital investment trusts. The shares look fair value.
Johnson Matthey, the FTSE 100 speciality chemicals group, wants acquisitions to beef up its main business, the production of catalysts for important chemical reactions, such as for catalytic converters and also for the chemicals, pharmaceutical and oil and gas industries. The exploding growth of the Chinese car industry and an economic recovery in Asia have boosted this key division, and the medium-term progress will be good as governments impose tighter emissions regulations. One to tuck away.
Perhaps not surprisingly for a group which supplies broadcasting equipment to TV stations, Vislink gets more media coverage than many of its size. It also has an army of followers among the penny-punting, day-traders. But there has been a further deterioration in sales in the UK, to defence contractors and broadcasters, and it is difficult to be excited about the company's trading prospects. Not worth chasing.Reuse content