Aga, the maker of cast-iron cookers, could be getting its act together after business plunged in the recession, Danny Fortson argued in his Inside the City column in the Sunday Times. The booming property market has helped Aga, which said in July that orders for its Rangemaster cooker were up 6% this year. Next year, a plan to support Aga's pension scheme could be completed, leaving the company room to reinstate its dividend. At first-half results on August 22nd investors will want to hear how the property market has benefited Aga and how its trendy new City 60 cooker is doing. It may be "time to warm the cockles", Fortson said.
Hold on to shares
of Derwent London, Questor said in the Sunday Telegraph. The London-focused investment trust, which favours the West End for its holdings, reported strong results, helping send its shares up more than 8% in a week. They have had a good run and now trade at 48 times forecast earnings with a prospective dividend yield of 1.5%. But property markets are cyclical and Questor is wary of buying Derwent shares at the peak of the current cycle.
Buy shares of drugs group Clinigen, Midas recommended in the Mail on Sunday. Clinigen's three niches are testing drugs for big pharmaceutical groups, buying specialised medicines to increase their sales and making thoroughly tested but unapproved drugs available to patients. The shares have almost halved since the start of this year because the City punished Clinigen for admitting growth would not be quite as rapid as hoped. The underlying business is sound and at the current price the shares offer "real potential".
Quindell's shares will react strongly when it spills the beans on the state of its relationship with RAC, Danny Fortson said in the Sunday Times. Quindell has not yet started installing the 50,000 a month of black boxes for RAC-insured cars agreed in April. Quindell denied that it had fallen out with RAC but refused to give details on restructuring talks. The shares will either go up or down sharply when Quindell reports its first-half results on August 21st the Inside the City tipster said.
Sell at least three quarters of holdings in Daisy Group, the telecoms and IT group, Midas said in the Mail on Sunday. Daisy's founder Matthew Riley has made an approach at 190p a share to take the company private after four years listed on the AIM market. Investors never lost money by taking a profit and with the shares trading above Riley's mooted offer price the future is uncertain because no bid is certain. Keep up to 25% of your holding if you feel adventurous, the share tipster said.
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