CITY TALK : BAe can withstand the turbulence

The waves from the Boeing/ McDonnell Douglas merger across the pond last weekend continue to break on the UK. The deal will squeeze Airbus Industrie in Europe, its main rival in commercial aircraft, leading to fears that British Aerospace - an Airbus shareholder - will find its pips squeaking. Any investors who are worried, however, should note that airlines will be loath to accept just one big supplier. That there is a threat to Airbus is clear, but it may also provide a catalyst for change at the company which still suffers from an unwieldy ownership structure. At 1,209p, British Aerospace remains a buy.

UNITED BISCUITS has been friendless for a long time; its shares have consistently underperformed for the past seven years. So long-suffering shareholders welcomed news of the completion of a restructuring at its Ross Young frozen foods division, with the pounds 44m sale of Ross Vegetables Products last week. The shares ended at 210p, up 13p from when the deal was announced. Although this rids the company of another commodity business in a severely competitive market, there is still little incentive to buy. The disposal will also require a write-off of pounds 51m, while the main biscuits business remains sluggish. And the much-mooted bid is nowhere to be seen. Avoid.

VOLEX (460p) is a cable manufacturer which specialises in the techie end of the market, turning out cabling for computer and telecom systems. The Warrington-based business has a good track record, but the shares have been obstinately stuck in a trading range of 400p to 470p for the past three years. However, the business is moving ahead with plans to build satellite manufacturing plants close to its main customers. A new 32,000 sq ft factory in San Diego, California, will open early in the new year. At the interim stage, profits were ahead a healthy 22.6 per cent. At around 13.4 times prospective 1997 earnings, the shares look good value. Buy.

BORDER TELEVISION may be one of the tots of the sector - annual sales are a mere pounds 12.6m. But interim figures showed earnings per share well ahead at 9p, from 6.5p the previous year. With strong cash flow from TV, expansion into radio, and plenty of cash on the balance sheet, the company is well placed. Yet despite these attributes, the shares remain cheap compared to the rest of the sector. Continuing consolidation suggests Border (at 312.5p) may well make a tasty morsel for one of the larger media groups. Buy.

BSKYB has overshadowed its smaller rival Flextech (656.5p), yet the latter is now the second- largest provider of cable and satellite programming in the UK after its mammoth competitor. Analysts at Merrill Lynch have begun coverage of the shares - still loss-making this year, they estimate, but due to break into profit in 1997 with pounds 4m pre-tax. Flextech has interests or rights in 15 channels or channel packages, but its greatest coup was securing a joint venture with the BBC for the launch of BBC Digital next autumn. Expect further exciting developments as pay day edges nearer.

ANALYSTS have trimmed back their estimates at MFI (189.5p), the furniture retailer, after the group turned in a strong set of interims, but not quite up to some expectations. James Capel, the stockbroker, has cut its 1997 pre-tax estimate to pounds 90.5m, from pounds 93m, and rates the shares a hold. Likewise, UBS noted the figures failed to quite match initial hopes, although it continues to rank the shares as a buy. The business itself is steaming ahead, with sales up 15.1 per cent, and pre-tax profits up 63 per cent to pounds 32.7m. One attraction has been the conversion of its 184 UK stores to the new MFI Homeworks format in the mould of a mini-Ikea - less flatpacks, more home furnishings, including wallpaper and upholstery. Partly because of the reformatting, costs are also on the up, with its Spanish foray, and the joinery business, Howdens, another drag on profits. But the shares remain at the least a firm hold, notwithstanding some election fears for interest rates and the knock-on impact on the housing market.

Start your day with The Independent, sign up for daily news emails
i100 In this video, the late actor Leonard Nimoy explains how he decided to use the gesture for his character
Arts and Entertainment
Secrets of JK Rowling's Harry Potter workings have been revealed in a new bibliography
arts + ents
Down-to-earth: Winstone isn't one for considering his 'legacy'
ebooksA special investigation by Andy McSmith
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

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

iJobs Job Widget
iJobs Money & Business

SThree: HR Benefits Manager

£40000 - £50000 per annum + pro rata: SThree: SThree Group have been well esta...

Recruitment Genius: Office Manager / Financial Services

£30000 - £37000 per annum: Recruitment Genius: Established in 1999, a highly r...

Jemma Gent: Year End Accountant

£250-£300 Day Rate: Jemma Gent: Are you a qualified accountant with strong exp...

Jemma Gent: Management Accountant

£230 - £260 Day Rate: Jemma Gent: Do you want to stamp your footprint in histo...

Day In a Page

HIV pill: Scientists hail discovery of 'game-changer' that cuts the risk of infection among gay men by 86%

Scientists hail daily pill that protects against HIV infection

Breakthrough in battle against global scourge – but will the NHS pay for it?
How we must adjust our lifestyles to nature: Welcome to the 'Anthropocene', the human epoch

Time to play God

Welcome to the 'Anthropocene', the human epoch where we may need to redefine nature itself
MacGyver returns, but with a difference: Handyman hero of classic 1980s TV series to be recast as a woman

MacGyver returns, but with a difference

Handyman hero of classic 1980s TV series to be recast as a woman
Tunnel renaissance: Why cities are hiding roads down in the ground

Tunnel renaissance

Why cities are hiding roads underground
'Backstreet Boys - Show 'Em What You're Made Of': An affectionate look at five middle-aged men

Boys to men

The Backstreet Boys might be middle-aged, married and have dodgy knees, but a heartfelt documentary reveals they’re not going gently into pop’s good night
Crufts 2015: Should foreign dogs be allowed to compete?

Crufts 2015

Should foreign dogs be allowed to compete?
10 best projectors

How to make your home cinema more cinematic: 10 best projectors

Want to recreate the big-screen experience in your sitting room? IndyBest sizes up gadgets to form your film-watching
Manchester City 1 Barcelona 2 player ratings: Luis Suarez? Lionel Messi? Joe Hart? Who was the star man?

Manchester City vs Barcelona player ratings

Luis Suarez? Lionel Messi? Joe Hart? Who was the star man at the Etihad?
Arsenal vs Monaco: Monaco - the making of Gunners' manager Arsene Wenger

Monaco: the making of Wenger

Jack Pitt-Brooke speaks to former players and learns the Frenchman’s man-management has always been one of his best skills
Cricket World Cup 2015: Chris Gayle - the West Indies' enigma lives up to his reputation

Chris Gayle: The West Indies' enigma

Some said the game's eternal rebel was washed up. As ever, he proved he writes the scripts by producing a blistering World Cup innings
In Ukraine a dark world of hybrid warfare and murky loyalties prevails

In Ukraine a dark world of hybrid warfare

This war in the shadows has been going on since the fall of Mr Yanukovych
'Birdman' and 'Bullets Over Broadway': Homage or plagiarism?

Homage or plagiarism?

'Birdman' shares much DNA with Woody Allen's 'Bullets Over Broadway'
Broadchurch ends as damp squib not even David Tennant can revive

A damp squib not even David Tennant can revive

Broadchurch, Series 2 finale, review
A Koi carp breeding pond, wall-mounted iPads and a bathroom with a 'wellness' shower: inside the mansion of Germany's 'Bishop of Bling'

Inside the mansion of Germany's 'Bishop of Bling'

A Koi carp breeding pond, wall-mounted iPads and a bathroom with a 'wellness' shower