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Sunday tips round-up: Cable & Wireless, Homeserve, Invensys

28 May 2006 11:15:00

The market is desperate for real evidence that C&W's UK business is turning round.

C&W trades on a price to earnings multiple of nearly 19. This makes it pricey compared with its peers, while estimates of a sum-of-the-parts valuation of 120p are probably not sufficient to entice private equity bids.

If and when those recovery signs appear there will be plenty of time for shareholders to jump on the bandwagon as real momentum builds up. For now, keep selling, the Sunday Telegraph writes.

Home maintenance specialist Homeserve is looking to expand overseas and has signed five marketing deals with US firms and is planning operations in France and Spain. Several City analysts say the current price, £16.99, fails to take account of Homeserve's global prospects. Buy says the Telegraph.

Things finally appear to be going in the right direction at engineer Invensys. The company is looking in much better shape and market conditions are improving. There are still risks, but keep buying for now says the Telegraph.

Diet supplement specialist Neutra-Health's sales are expected to grow from £2.4m last calendar year to £9.3m this year and profit is expected to grow from £400,000 to £1.6m. The nutraceuticals sector is growing by 10 to 15% a year. The company will launch branded travel products into the retail market later this year. Buy says the Telegraph.

Peninsular Gold has a low-cost operation working over tailings at the site of legacy mine works in Malaysia, where it produces gold at a cost of just $163 (£87) per ounce, compared with a current price of $680. It has £5m in the bank to fund its exploration while production gears up. At their current price the shares look worth tucking away, says the Telegraph.
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