Buy housebuilders' shares
and hold them until near the end of March to take advantage of the sector's record of outperforming the wider market in the first quarter, the Sunday Telegraph's Questor column advised. Housebuilders beat the rest of the market in the first three months in 16 of the last 20 years. The shares will be supported by a series of trading statements, starting with Persimmon on January 8th, and support from the Government's Help to Buy scheme. During sharp corrections, this trade helps shelter capital, too.
Buy shares of Topps Tiles, the Sunday Times's Danny Fortson recommended in his Inside the City column. Topps' shares jumped by more than 130% in 2013 but there is further to go. Its fortunes are closely tied to the housing market and the resurgence in that market is set to continue. In 2007, Topps' earnings were £44m from fewer stores than last year when earnings were £15.6m. If Topps can get close to that pre-crisis performance it will show through in the share price. The company reports on first-quarter trading on January 7th.
Buy and hold on to shares in NewRiver Retail, the Mail on Sunday's Midas column recommended. The company, founded five years ago, owns and manages 26 shopping centres that will gain from economic recovery. Chief Executive David Lockhart is a commercial property veteran with a record of snapping up assets at the bottom of the market. He recently bought 202 Marston's pubs to convert into convenience stores - one of retail's fastest-growing segments. The dividend yield is more than 5% and the payout is set to rise.
The Sunday Times's writers each tipped shares to rise in 2014. They were:
Dominic O'Connell: Hang on to BG Group shares, which O'Connell tipped a year ago. This year, buy Essentra, the manufacturer of various items including cigarette filters. Chief Executive Colin Day has overseen a good run in the shares and will keep the company moving ahead.
Iain Dey: The easing of the Eurozone crisis and the prospect of increased returns and dividends could see Aviva become an investor favourite under tough new boss Mark Wilson. Merrill Lynch analysts think the shares are 20% below fair value but Dey said that estimate undervalued the company.
Kathryn Cooper: RIT Capital Partners, the investment trust chaired by Lord Rothschild, takes a defensive approach that could pay off if buoyant investor expectations do not materialise. Non-executive director Mike Wilson bought 10,000 shares on December 19th.
Matthew Goodman: Lavendon, which hires out aerial platforms and cranes for construction, has opportunities in the Middle East and the UK. The shares trade at a discount to the sector and yield just under 2%.
John Collingridge: National Express shares gained 35% in 2013 but they will rise further, helped by a reduction in fuel prices, falling debt and solid management. The transport group is diversifying internationally and has opportunities at home such as being shortlisted for the ScotRail and Crossrail franchises.
Simon Duke: Rightster is a risky investment but the video streaming company has big growth opportunities as households watch more content online. In a fragmented industry Rightster, whose customers include Warner Bros and Conde Nast, could be a takeover target.
Ben Marlow: Conviviality Retail is the parent of the Bargain Booze chain of cut-price off licences. The shares have jumped 74% since Conviviality floated six months ago but the respected management team has plans to expand outside its North West base. The shares have a dividend yield of 4.8% and trade at a discount to peers.
Oliver Shah: Berkeley Group's shares have almost tripled over five years, making Shah nervous about his recommendation but Berkeley has plenty of prime London sites bought at bargain prices and a top-notch Far East sales team. It has also pledged to return cash to shareholders over the next decade.
Danny Fortson: Circle Oil is a risky investment because its assets are in the region most affected by the Arab Spring. But its Egyptian wells were unaffected by unrest in the country and they make the company cash generative. Circle also has good prospects in planned new wells in Morocco and Tunisia.
Steer clear of Asos shares, Danny Fortson advised in his Sunday Times column. Fortson apologised for offering the same view a year ago when the shares were at £26. They have since surged to £67.50 but the online clothing retailer trades at 60 times estimated 2015 earnings. It is hard to see how this can continue. Asos's fortunes this year depend largely on its progress in China where it has launched a website. A wobble in its progress could cause the shares to fall.
Adventurous investors should take a punt on China Chaintek United, the Midas column advised in the Mail on Sunday. The Chinese logistics business is based near the manufacturing hub of Jinjiang and is expanding into distribution of food and building materials. It focuses on second-and third-tier cities with plenty of growth potential and, though investors are wary of Aim-listed Chinese shares, the company looks solid and should grow quickly.
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