Aviation and newspaper distributor John Menzies should be re-rated after getting debt to more acceptable levels and re-introducing the dividend, says JP Morgan.

Tuesday's results revealed a "resilient" performance from the distribution operations, while like for like (LFL) trading at the aviation business beat expectations in the fourth quarter.

This year started well, with positive LFL trends in January for the first time since the recession began.

"Menzies Aviation remains geared into a recovery and if trading conditions improve, particularly in cargo volumes, the group should start to see the benefit on the bottom line relatively quickly," said the broker.

Menzies only trades on a PE of 7 compared with 8 for Smiths News and almost 13 for the FTSE All Share, so JPM upgrades its view to 'overweight' from 'neutral'.

Related share prices
Smiths Group (SMIN) share price
John Menzies (MNZS) share price