Peek shares have further to climb

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The Independent Online
PEEK, last tipped here at 77p in February, has been climbing slowly but steadily since then, and now stands at 93p, near its year high.

It has also outperformed the market over the past year, and news this week that it has consolidated its rapidly growing Asian business with a pounds 11m contract to supply Bangkok with a traffic control system will only further boost the shares' appeal.

The contract should also eliminate losses on the group's Asian business, and a rise in the dividend, which has remained steady at 3.4p the past five years, cannot be ruled out.

SHARES in resurgent stores group Asda have been as impressive as its trading performance in recent months. Full-year figures saw pre-tax profits rocket to pounds 257.2m from pounds 125.9m in 1994.

But the figures have prompted a contrary view from the food retail team at broker Henderson Crosthwaite, which has issued a recommendation to take profits. The brokers figure recent share price outperformance is unlikely to continue, and investors should think about locking in some profits.

At 94.25p, it trades on only a slight premium to its peers, (15.1 times 1995 earnings, against 14.1 for Argyll and 14.8 at Sainsbury). Although brokers are confident that Asda can meet demanding expectations of more growth to come, Henderson considers that the shares already fully discount such future successes.

MORE is less - or so it appears at betting and hotels group Ladbroke. Punters can now have a flutter on the nags in the evenings and on Sundays, but they seem reluctant to do so because of the fewer options available on smaller fields.

The negative impact on betting volumes of more race meetings than ever before was one reason cited by joint broker Smith New Court for last week's profits downgrade. It cut 1995 pre-tax projections from pounds 177m to pounds 162m, and reduced the 1996 forecast from pounds 220m to pounds 201m.

While debt should continue to fall as hotels are sold, the immediate trading outlook makes the badly underperforming shares, out of favour for a while now, at 165p, unappealing. Avoid.

THE Rugby World Cup underlined South Africa's return to the international arena, and the country's growing acceptance by Western countries as a political equal. South African Breweries, sponsor of the Springbok team, may not figure on a list of highlights from the tournament. However, changed political circumstances have opened up new opportunities for the company, which occupies a different place in the South African economy from its UK equivalents.

The company is one of the bluest of blue chips. As well as 98 per cent of the local malt beer market, it also boasts extensive interests in other areas. It also dominates the local hotel industry, with 50 per cent of tourist beds in the country, is a big retailer and glass producer.

On the earnings front, it has produced a remarkable 28 years of uninterrupted growth. With a successful foray into Eastern Europe already under way, it looks set to sustain this record. For anyone who wants to look at safe investment in an economy which will remain subject to spills, the shares, which can be bought in American Depository Receipt form at US$29.50, are a good place to start.

GENERAL CABLE has one feature that makes it stand out from the other two quoted entities in the sector, Telewest, and Nynex. It is the only one whose share price, at 193p, has just managed to stay above its issue price of 190p. While it has long been argued whether cable companies offer punters a sensible home for their money, in General Cable's case there are hopes the company will move into profit by 1998.