TSB left with not much to count on

City Talk

TSB Group shares caught a cold on Friday, shedding 5p to 252p - a fall of 16p from their 16-month high in the wake of a downgrade from hold to sell by Chris Smith, banking analyst at stockbroker James Capel. Mr Smith blighted the whole sector, taking Abbey National down 18p to 476p, Lloyds 9p to 645p, National Westminster 4p to 557p, and Barclays 8p to 675p, as he raised further concerns about the future health of the mortgage market.

Mr Smith said: "We have taken a new look at the mortgage market data, after advances fell sharply in April, down 15 per cent year-on-year. The volume of business is so low that they are having to employ excess capital in the capital market, where the margins are lower."

TSB's half-year results on 22 June will lead the rest of the banks. Mr Smith is sticking to his forecast of pounds 342m profits before provisions, against pounds 356m previously, but the real worry is that he sees no light at the end of this tunnel.

He prefers Barclays and NatWest, where more lending goes to small business and manufacturing.

STOCKBROKER Killick likes last week's figures from European Colour, the chemical colours maker - profits jumped 53 per cent and the dividend rose 48 per cent to 1.7p a share. "Once more, the company has extended its growth profits trend and is fulfilling its potential," the firm said.

The broker sees profits rising from pounds 1.87m to pounds 3.15m this year, and to pounds 3.8m next. At 80p, that would take the p/e ratio down to 12.

Good value, as the chemical market swings up.

ACCEPT the bid, says Nyren Scott-Malden, BZW's tobacco-sniffer, analysing the 625p-a-share offer by Richemont for the 39 per cent of Rothmans International it does not own.

"In the absence of a bid," says Mr Scott-Malden, "we do not believe that the shares would stand at above 500p." The shares are currently trading at 612p.

HIGH enough, says stockbroker Charles Stanley, about Queens Moat Houses shares, which have nearly doubled to 17p since we recommended them here three weeks ago.

Stanley suspects that the recovery from near-collapse may be slow, advising the patient to hold on, but recovery specialists should wait for a relapse before buying any more.

THE odium heaped on directors of British Gas during the six-hour annual shareholders' meeting on 31 May might, you would think, leave the shares friendless.

Not a bit of it. They have risen 13p to 315p since the crowds streamed out of the London Arena, as word filters through the City of successful cost-cutting and higher oil and gas production.

This should take profits over pounds 1bn this year, against pounds 737m in 1994. The shares are worth buying for the 6 per cent yield alone.

A SLICE of pizza is stockbroker BWD Rensburg's chosen dish, as the broker recommends PizzaExpress shares at just a penny off their year's high of 154p.

"The group is a strong upmarket and branded business with above average growth potential," says Rensburg's analyst, Sahill Shan.

The group plans to expand its 82-strong chain by 10 outlets a year over the next five or six years, aiming at 150 funded internally.

In the year ended this month, profits should have risen from pounds 4.5m to pounds 6.5m, putting the shares on an earnings multiple of 23.5.

Expensive, but good value. Buy.

Start your day with The Independent, sign up for daily news emails
Arts and Entertainment
Lou Reed distorted the truth about his upbringing, and since his death in 2013, biographers and memoirists have added to the myths
musicThe truth about Lou Reed's upbringing beyond the biographers' and memoirists' myths
Ed Miliband received a warm welcome in Chester
election 2015
Life and Style
Apple CEO Tim Cook announces the Apple Watch during an Apple special even
fashionIs the iWatch for you? Well, it depends if you want for the fitness tech, or the style
ebooksA special investigation by Andy McSmith
  • Get to the point
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: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...

Ashdown Group: IT Manager / Development Manager - NW London - £58k + 15% bonus

£50000 - £667000 per annum + excellent benefits : Ashdown Group: IT Manager / ...

Recruitment Genius: Sales Consultant / Telemarketer - OTE £20,000

£13000 - £20000 per annum: Recruitment Genius: Scotland's leading life insuran...

Ashdown Group: Training Programme Manager - City, London

£40000 - £45000 per annum + benefits : Ashdown Group: Training Programme Manag...

Day In a Page

NHS struggling to monitor the safety and efficacy of its services outsourced to private providers

Who's monitoring the outsourced NHS services?

A report finds that private firms are not being properly assessed for their quality of care
Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

The Tory MP said he did not want to stand again unless his party's manifesto ruled out a third runway. But he's doing so. Watch this space
How do Greek voters feel about Syriza's backtracking on its anti-austerity pledge?

How do Greeks feel about Syriza?

Five voters from different backgrounds tell us what they expect from Syriza's charismatic leader Alexis Tsipras
From Iraq to Libya and Syria: The wars that come back to haunt us

The wars that come back to haunt us

David Cameron should not escape blame for his role in conflicts that are still raging, argues Patrick Cockburn
Sam Baker and Lauren Laverne: Too busy to surf? Head to The Pool

Too busy to surf? Head to The Pool

A new website is trying to declutter the internet to help busy women. Holly Williams meets the founders
Heston Blumenthal to cook up a spice odyssey for British astronaut manning the International Space Station

UK's Major Tum to blast off on a spice odyssey

Nothing but the best for British astronaut as chef Heston Blumenthal cooks up his rations
John Harrison's 'longitude' clock sets new record - 300 years on

‘Longitude’ clock sets new record - 300 years on

Greenwich horologists celebrate as it keeps to within a second of real time over a 100-day test
Fears in the US of being outgunned in the vital propaganda wars by Russia, China - and even Isis - have prompted a rethink on overseas broadcasters

Let the propaganda wars begin - again

'Accurate, objective, comprehensive': that was Voice of America's creed, but now its masters want it to promote US policy, reports Rupert Cornwell
Why Japan's incredible long-distance runners will never win the London Marathon

Japan's incredible long-distance runners

Every year, Japanese long-distance runners post some of the world's fastest times – yet, come next weekend, not a single elite competitor from the country will be at the London Marathon
Why does Tom Drury remain the greatest writer you've never heard of?

Tom Drury: The quiet American

His debut was considered one of the finest novels of the past 50 years, and he is every bit the equal of his contemporaries, Jonathan Franzen, Dave Eggers and David Foster Wallace
You should judge a person by how they peel a potato

You should judge a person by how they peel a potato

Dave Hax's domestic tips are reminiscent of George Orwell's tea routine. The world might need revolution, but we like to sweat the small stuff, says DJ Taylor
Beige is back: The drab car colours of the 1970s are proving popular again

Beige to the future

Flares and flounce are back on catwalks but a revival in ’70s car paintjobs was a stack-heeled step too far – until now
Bill Granger recipes: Our chef's dishes highlight the delicate essence of fresh cheeses

Bill Granger cooks with fresh cheeses

More delicate on the palate, milder, fresh cheeses can also be kinder to the waistline
Aston Villa vs Liverpool: 'This FA Cup run has been wonderful,' says veteran Shay Given

Shay Given: 'This FA Cup run has been wonderful'

The Villa keeper has been overlooked for a long time and has unhappy memories of the national stadium – but he is savouring his chance to play at Wembley
Timeless drama of Championship race in league of its own - Michael Calvin

Michael Calvin's Last Word

Timeless drama of Championship race in league of its own