BSG strapped in to motor ahead

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The Independent Online
MEMO to Richard Marton, chief executive of BSG, the Bristol Street motor dealer, and Britax seat belts group: persuade the powers-that-be to transfer your share price listing from the lowly Engineering Vehicles sector to the higher-rated Distributors category. That is likely to be the shortest cut to getting your share price up from its current 53p to the 75p or so that the group's performance deserves.

That performance should be underlined on Tuesday, when BSG announces 1994 results that should see pre-tax profits up from £10.5m to around £16m before exceptional items costing some £3m. Having taken over Jessups, the motor dealer, last year, Mr Marton has his eye on deals to boost the manufacturing side. But the shares, currently yielding an overfat 7.5 per cent, will remain under a cloud until one of the divisions is hived off.

ANOTHER unnoticed transformation has been that of William Baird, formerly a dreary engineering group, now reconstructed as a well-run clothing business featuring such excellent brand names as Windsmoor and Berkertex, as well as taking a growing role in Marks and Spencer's supply chain. Joan D'Olier at NatWest Securities expects Thursday's 1994 final profits to be a tenth up at £25m. This would put the shares, beached at a dreary 200p, on a p/e of less than 15. Worth a punt.

NAMES used to be worth something in the construction business. No longer. One of the proudest, John Laing, has suffered with the rest of the sector. This is not surprising. Margins are so tight that even a 1 per cent miscalculation can put contracts into loss. The group is well enough managed and asset value - including some valuable investments and joint ventures - is well above the 203p share price. But even if next Tuesday brings relatively cheery results for 1994, do not be tempted

THE frugal British consumer is starting to spurn the TV dinner for a modest restaurant meal. While specialists such as Groupe Chez Grard - reporting this week - and Pelican Group are known to be benefiting from this mini-trend, less recognised are the catering virtues of the brewer Whitbread, which owns the Beefeater and Brewers Fayre eatery chains and has a stake in Pizza Hut. Richard Marshall, at Investment Research of Cambridge, sees Whitbread shares amassing strength as the group's profits grow by a steady 10 per cent a year. At 564p, the shares yield 4.2 per cent and sell on 14.5 times likely earnings of 39p for the year ended this month. Buy.

IT could be a last throw of the dice, but the arrival of a new executive chairman at the troubled Upton & Southern retail group might just be the time to wager a few pennies. The group owns three department stores in the North-east but nearly bought the farm last year when it purchased The Reject Shop chain and discovered gruesome skeletons lurking in the cupboard. Ron Trenter, former chief executive of Texas Homecare, has joined and could get the shares motoring from their present bombed-out 3p. But it is a gamble.

THE market is making a fool of itself over Watmoughs, a printer with an astonishing long-term record: profits have risen virtually every year since it came to the market in 1963. Yet even though 1994 pre-tax profits were up a fifth to £20m, the shares remain at a relatively lowly 354p, a third below their 1994/95 high. This is mainly because of fears over increased paper costs. These are largely irrelevant. Far more important is Watmoughs' success in securing a steadily increasing share of the booming newspaper colour supplement market. An outstanding long-term buy.