Share tips of the week
MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
Three to buy
CVS Group
(The Times) This veterinary chain saw its practices closed during the first lockdown, but business has rebounded. Total sales were up by 6.3% during the four months to the end of October compared with a year before and the second lockdown has been less disruptive. That has allowed it to reduce debt and grow its portfolio of 480 practices through “bolt-on acquisitions”. Add in rising pet ownership and the outlook is encouraging. 1,435p
Rolls-Royce
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
![https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg](https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748-320-80.jpg)
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
(Shares) Shares in this aviation engineer have soared on hopes that a vaccine will soon have us all flying again. Rolls-Royce is part of an “effective global duopoly” with General Electric for civil aviation engines, an area that accounts for more than half of sales. The medium-term outlook for aviation is foggy, but Rolls-Royce’s more lucrative nuclear-power systems and defence divisions should keep profits buoyant. On a free cash-flow yield of 8.4% for 2022, the shares look “great value” for patient investors. 107p
VinaCapital Vietnam Opportunity Fund
(The Times) Vietnam has been a trade-war winner as the likes of Apple and Microsoft move manufacturing there from China. This fund buys both listed and private companies in the hope of delivering long-term capital growth. It is particularly exposed to domestic property and construction: a growing population and expanding infrastructure needs bode well for these sectors. An expanding middle class is also driving demand for financial services. The valuation is still attractive and a dividend yield of 2.3% is a final boon. 365p
Three to sell
National Grid
(The Daily Telegraph) National Grid should be “the perfect income stock”.Its customers can hardly switch to another provider, ensuring a predictable flow of revenue. But that is where the regulator Ofgem steps in. A forthcoming framework could “halve the regulated return” of the group between 2021 and 2025, although we will have to wait a few weeks for more details. Even worse, there are reports that the government is considering an outright breakup as part of its carbon reduction strategy. Even if National Grid dodges that bullet, lower profits will mean either a dividend cut or higher debt. The risks are too high. 881p
Kandi Technologies
(Barron’s) There’s a new kid on the electric-vehicles block. This Nasdaq-listed Chinese maker of vehicles and batteries has seen its share price roar this year, but it has been a volatile ride. The company is loss-making, but the upcoming launch of the K27, a “Mini-Cooper size” electric car, has unleashed speculative excitement. But beware. Imported compact cars have a long history of underperforming in the US (remember the fate of the Yugo in the 1980s). $12
Palantir Technologies
(Motley Fool UK) Palantir, which listed in New York in September, builds software to help financial companies, carmakers and intelligence agencies to corral vast amounts of data. Full-year sales should eclipse $1bn, a 44% rise on last year. The problem is the price: on a price-to-sales ratio of 45 there is considerable downside. The fact that the founders have offloaded tens of millions of dollars of stock since the listing is also hardly reassuring. Avoid. $28
...and the rest
The Daily Telegraph
It would take a brave investor to bet against the “tidal wave of cash” heading into the renewable-energy sector. Utility SSE, which is working on the world’s largest offshore wind-farm project at Dogger Bank, looks well-placed to profit. Hold (1,361p). Shares in Covid-19 treatment and testing specialists Synairgen and Avacta have fallen back on the vaccine news, but both are set to adapt their expertise to other conditions. It’s a “speculative buy” (89p; 113p).
The Mail on Sunday
A strong first-half performance at cake chain Cake Box shows that consumers are finding a sugary way to beat the lockdown blues. The shares are up by 37% since July 2018. Some profit-taking may be in order, but shareholders should keep a stake: it makes sense to have some cake as well as eat it (188p).
Shares
New York-listed medical science firm Boston Scientific makes everything from pacemakers to catheters. Cancelled elective procedures have seen the shares stall this year, but there is now a backlog to clear. Rising margins and judicious acquisitions should also prove a tailwind ($33.33).
The Times
A DIY and renovation boom has driven “stunning” sales at B&Q and Screwfix owner Kingfisher. Further progress will depend on whether the housing market can hold up, but this is proving to be a successful turnaround story. Buy (271p). Trading at Greggs will bounce back swiftly next year but on 43 times forward earnings the shares are pricey – hold (1,799p). It will take more than a perkier oil price to make up for past disappointments at Tullow Oil. Avoid (32p).
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
-
What is an offset mortgage and should you consider one?
Mortgages Offset mortgages are a good way to put your money to work. We explain what they are and if they might work for you.
By Ruth Jackson-Kirby Published
-
Tesla and Alphabet announce results – should you invest in Big Tech?
How profitable are the world’s biggest tech companies? We share the latest so far this earnings season.
By Katie Williams Published
-
UK mid-caps: an improving outlook
UK mid-caps have perked up and the rally may run further, but long-term investors should remain selective
By Cris Sholto Heaton Published
-
The tobacco industry is going smoke-free - how to profit from it
Tobacco companies have realised their traditional products are on the wane. But new opportunities have opened up – and should prove lucrative
By Rupert Hargreaves Published
-
Is it time to invest in creative industries?
Any industrial strategy should not overlook the creative industries, one of our top national assets
By David C. Stevenson Published
-
Is Mercia Asset Management set for success?
Mercia Asset Management helps the government fund smaller companies in Britain’s regions. Should you invest?
By Rupert Hargreaves Published
-
British stocks set for a boost
British stocks are due for a bounce as the UK looks more stable compared to many economies
By Alex Rankine Published
-
Ocado shares jump by a fifth
Ocado takes a turn for the better after attractive profit forecasts were announced
By Dr Matthew Partridge Published
-
The AI boom is on borrowed time
The hype around the AI boom could be on its way out – but why?
By Alex Rankine Published
-
Diploma: a blue-chip set for strong growth
Diploma, whose niche products include seals and fasteners, serves an array of growth markets. Should you invest?
By Dr Mike Tubbs Published