Sunday Telegraph: Supermarket group Morrisons expects to complete its acquisition of Safeway by March. Broker Numis thinks the move could create a group that can challenge Asda and Sainsbury’s forthe number two slot in the UK. Morrisons should continue to outperform its competitors. Buy.
Shares in transport group Stagecoach have recovered strongly from this time last year when the company was forced to write-off pounds 500 million on its US operations. Stagecoach has successfully restructured in the US and is trading well in the UK. They are unlikely to be spectacular performers but should have further to go. Buy.
Sunday Times: Many of the issues that held electronic retailer Dixons back last year have been resolved. At 141.75p the shares have traded sideways for the past six months. A good showing on Wednesday, when the firm reports, could spark a re-rating. Sunday Express: Reuters is set to release positive first-quarter revenue guidance before its 2003 full-year results appear on February 17. Analysts believe revenues are showing signs of stabilising -the cancellation of contracts for company’s terminals in December is running at a much lower level than for 2002. Buy at 261.5p.
The 22.5 per cent of the Japanese market gained by Telecoms group Vodafone in December should reassure investors this part of the business is improving after a fall-off in sales.
It follows Vodafone’s best month of 3G net adds at 18,500. Buy at 148.25p The biggest problems at IT conglomerate Misys were in its banking and securities division, but broker JP Morgan thinks the company’s recovery is deferred rather than derailed. It is looking at full-year pre-tax profits of pounds 54 million. Buy at 216p.
Broker Teather & Greenwood says hedge fund manager Man will do well this year, albeit not as well as last year. The weakness of the US dollar will help sales to US investors, giving predicted fullyear pre-tax profits of pounds 441 million compared with pounds 348.1 million in 2003. Buy at 1552p.
Mail on Sunday: Last week it was reported that defence group BAE Systems’s non-executive director Paolo Scaroni would not run for re- election.
There has been concern about its ability to deal with cost overruns after it wrote off pounds 750 million against two projects. The City will watch next month’s results with interest.
Independent on Sunday: Revenues atRoyal Bank of Scotland are increas-ing, margins are high and cost control remains excellent.
