Imperial Tobacco has become one of the top 10 FTSE 100 shares
for dividend yield, the Mail on Sunday's Midas column said. Its share price has lagged because consumers have cut back on smoking or turned to the black market but the dividend is resilient and set to rise. The forecast yield for the year ended September 30th is more than 5.2%. BP has also entered the list and it too yields more than 5.2%, Midas said. The top 10 yielders, which also comprise Admiral, Royal Dutch Shell, Admiral, SSE, National Grid, United Utilities, Resolution and RSA, are rivals to Royal Mail for investors seeking income.
Imperial Innovations' record of turning scientists ideas into businesses is poor, the Sunday Times's Danny Fortson wrote. Its biggest success is the £12.5m it made on a 14% stake in Thiakis when it was sold in 2008. But it is not a great performance considering Imperial raised £196m when it floated seven years ago. Its biggest bet is the £25m invested in Circassia, whose treatment for cat allergies is in human trials that won't finish until 2015. Until then shareholders are basing their investments on faith.
Hold on to shares in BAE Systems, Questor said in the Sunday Telegraph. Analysts have reduced earnings forecasts for the year ending December 2013 by 9% after the US shutdown added to the potential pain from existing defence spending cuts. BAE is also suffering from contract delays but it is confident about sealing the "Salam" contract with Saudi Arabia for 72 jetfighters. If that deal goes ahead it will support BAE's planned £1bn share buyback. BAE shares trade at a discount to others in the industry and to its own long-term average. Short-term problems are priced in and BAE is a stock to stick with for the long run.
Shares in Bellway the housebuilder look cheap, the Sunday Times's Danny Fortson said. His Inside the City column said there was plenty of optimism about Britain's resurgent housing market in Bellway's share price but that with just £6m of debt and shares that have drifted down over they summer. Full-year results are expected to show pre-tax profit up by a third, boosted by the Government's Help to Buy scheme. The company is now an attractive investment with the added allure of rising dividends.
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