Thursday tips round-up: Aegis, Moneysupermarket.com, Cobham
Aegis has a lower exposure to the economy across the pond than its peers, with the Americas accounting for 30pc of sales. Not all its income is advertising-dependent; the market research arm Synovate accounts for a sizeable chunk of revenues.
Aegis also makes more money from the web than its rivals - according to Merrill Lynch 30pc of media sales and 19pc of overall sales will be digital by the end of next year. Trading on 12.8 times 2008 earnings, Aegis is at only a 5pc premium to rival WPP, the smallest gap for two years. At that price, it looks like good value, says the Telegraph.
Moneysupermarket.com says revenue for the year just ending will be around £160m, in line with forecasts and 60 per cent ahead of last time, while earnings before all charges will come in around £51m.
The figures provided comfort to the markets although the company's admission that it is difficult to predict what might lie ahead because "visibility continues to remain limited" will put a brake on any major re-rating. The shares gained 16p at 146p where they trade on a modest 13.8 times next year's forecast earnings. Not expensive, but it may be too early to chase the shares. Hold, writes the Independent.
UBS puts a price target of 225p on Cobham and at that price it is good value even without a merger premium, which other analysts believe could take the shares up as high as 265p if a bidding war were to break out.
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Cobham also said yesterday profits for the first 11 months of 2007 are ahead of last year despite the struggling dollar, which has hit its US operations. Takeover or no takeover, this one looks like a solid bet, says the Telegraph.
Broker Panmure Gordon's decision to buy a small US investment bank to provide a new pipeline of business for the London market looks well timed. The shares have slumped from 188p this year and at 83p look ripe for recovery, writes the Independent.
Property consultants DTZ had already lost over 65 per cent of its value this year but there was clearly further to go. A warning that the global credit crunch was making life a lot more difficult lopped a further 33p off the price at 262p. First-half profits are down from £15.4m to £11.7m although after stripping out costs the underlying picture is flat. The worry is that the second half could fall off a cliff. Avoid, says the Independent.
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