The experts' share selections to beat the stock market this year

Tips for 2004: Fund managers, our in-house investment analysts and five-year-old Emily Reece study the outlook for the next 12 months

Ralph Brook-Fox of Britannic Investment Management comes away with top honours in our fund managers' portfolio, which performed a little ahead of the market last year. His brave tip was mmO2, the mobile phone group which has won plaudits for turning around its ailing German business.

Ralph Brook-Fox of Britannic Investment Management comes away with top honours in our fund managers' portfolio, which performed a little ahead of the market last year. His brave tip was mmO2, the mobile phone group which has won plaudits for turning around its ailing German business.

Runner-up was David Cumming of Standard Life. He tipped HMV, the music retailer. There were other big gains for John Hatherly's tip, Mitie, the maintenance group that has been winning big public sector contracts, and for Anglo American, the mining giant recommended by Colin McLean of SVM.

The only disaster was Invensys, the industrial conglomerate tipped by Dennis Wyles of Aegon Asset Management.

Our team's selections for the new year are:

Ralph Brook-Fox, Britannic: mmO2 (77p)

We once again select mmO2, on the principle of running winners. The rebranding to O2 has been successful, with the creation of a strong brand at sensible cost that is attractive to data-savvy younger users.

From its German business being widely considered a liability, O2 is turning it into an asset. Germany has lower mobile penetration than most of Europe, making above average a realistic prospect.

John Hatherly, M&G: HHG (39p)

I am going for HHG - the UK fund management group spun out of Australia's AMP in December - on the basis that it is still trading at a substantial discount to embedded value. Its Henderson asset management business is a geared play on the market and on the fund management industry, and there must be an outside chance of a takeover bid.

Colin McLean, SVM Asset Mngt: Corus (30p)

My tip for 2004 is the Anglo-Dutch steelmaker, Corus. The shares have fallen from a peak of 180p four years ago, as the group has struggled with overcapacity and high debt. However, Corus has been cutting costs, and a recent share issue raised £300m to help ensure survival. It should enjoy firmer steel pricing in 2004, and benefit from a pick-up in European demand.

David Lis, Morley: Center Parcs (108p)

We like Center Parcs, the largest premium-branded holiday village concept in the UK. The company has a unique product, with high barriers to entry created by the £120m cost of each holiday site. The business grew profitability throughout the 1990-94 recession while maintaining occupancy rates above 90 per cent, so it looks well placed even if there is further weakness in consumer spending in 2004.

Andy Crossley, Invesco: Monterrico Metals (186p)

Monterrico metals is a mining company with prospects in Peru. It recently announced the results of a pre-feasibility study on one of its copper projects, which gave a net present value (NPV) of US$320m, equivalent to over £9 per share. While mining companies at the pre-feasibility stage trade at a discount to NPV, this NPV was based on a copper price of 90 cents per pound and the metal is already trading at 105 cents. The price is likely to remain firm, with world demand forecast to exceed supply until at least 2006.

Ruth Keattch, DWS Investments: Jacques Vert (18p)

When Jacques Vert bought William Baird in December 2002 it inherited a host of problems. Vert spotted an opportunity to release value from Baird's many overlooked assets. The private equity house, Alchemy, has built its stake to 27 per cent and clearly sees value in the situation.

Mike Felton, Isis Asset Mngt: Shell Transport (415.5p)

Oil stocks performed poorly in 2003 and, in contrast to the mining sector, failed to benefit from the China growth phenomenon. Forecasts persist in assuming that oil prices will materially fall, despite Opec's recent success in keeping the price in a rich $22-$28 per barrel band. Shell trades on a relatively modest 14 times 2004 earnings prior to expected upgrades, and also boasts a rock-solid 4 per cent dividend yield. After a disappointing year, you can be sure of Shell in 2004.

David Cumming, Standard Life Investments: Tate & Lyle (311.5p)

Disillusionment with defensive stocks, given strong global recovery prospects, has led to the valuation of Tate & Lyle, one of the oldest companies on the stock market, drifting to unrealistically low levels. Worries about rising raw material costs are excessive as Tate is achieving offsetting price increases. Positives include a new management team, while tighter capacity utilisation will drive up prices and profits for its US sweeteners business. And the company is in theory vulnerable to a bid.

How Emily makes tipping child's play

A portfolio of toys and cartoon characters proved a hit for Benjamin, the four-year-old son of our former City Editor, Nigel Cope. He put the professionals to shame with a 34 per cent gain over 2003.

Hamleys, the toy shops group, was taken over at 254p a share, compared with 162.5p at the start of the year. Chorion, the owner of Noddy and other Enid Blyton characters, has also attracted bid interest, pushing its shares up 43 per cent. Woolworths, the toys and gifts retailer, was also a strong performer. Benjamin's worst share was Diagonal, a technology stock, but he struck lucky with Punch Taverns - perhaps chosen because it sounded like another children's character - whose expansion in 2003 more than doubled the share price.

This year's tipster is Emily, aged five, daughter of the current City Editor, Damian Reece. With an aplomb and confidence that only one from her particular female line could produce, Emily immediately chose at random LVMH, the luxury goods group of fashion fame on €57.75 (£40.67) a share. Next were a series of more down-to-earth investments in Royal Bank of Scotland (£16.46), Shell Transport (415.5p) and J Sainsbury (312.75p). Emily added another bank, Abbey National (531p).

Asked what she would do if she had loads of money, Emily replied: "I would buy a huge truck with a whole town on it." When pressed she came up with Tibbett & Britten (404.5p) in the transport sector.

And after a long City-style lunch of fish fingers and Ribena, Emily resumed her random walk with Britannic Group, the insurer (292.25p), Kesa Electricals (257.25p), owner of the Comet stores, Millennium & Copthorne (303p), the hotels group, and nCipher (152p), the software and computer group.

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