LONDON Tips Watcher Alert (UK)

Date: Thursday 20 May 2010

Thursday's tips round-up: Caledonia, Spectris, AngloPac

The slow but steady nature of Caledonia’s returns will appeal to the very long-term investor, as will its record on dividends — that payout was raised yesterday, by 4.4 per cent, the 43rd year of successive advance. However, given the stock market’s recent slide, there are better bargains available elsewhere. Pass, says the Times.

Trading on a 2011 multiple of about of 8.5 times, Spectris is in line with its peer group, while the dividend yield, at an estimated 2.9 per cent this year, is solid but not incredible. We reckon that Spectris is a good company, but the best is probably over. So hold, recommends the Independent.

AngloPac offers low-risk exposure to a range of commodities, principally coking coal, gold and uranium in Australia, Canada and Brazil. It also books all its sales in US dollars, carries no debt and pays out a slug of its royalties in dividends, says the Times. At 247žp, or a 19 per cent discount to net assets, and providing a solid 3.6 per cent yield, tuck away.

Speedy Hire at a 38 per cent discount to its 48p of net assets per share, this is strictly a buy for the brave.

At around 11 times forecast 2010 earnings, Mitchells & Butler shares are hardly cheap given the risks and there's no yield either. But, with the prospect of stability at the corporate level after the recent boardroom upheavals and the group's proven ability to outperform when times were even more difficult than they are today, we would stick with M&B for now. Hold, writes the Independent.