Traders' views - Stock trading

Share tips of the week 1 May 2012

By , 01 May 2012

Share tips and momentum stock advice from the Share Centre's expert investment research analyst

The high risk punt this week is Smiths News (SMIN). The UK’s biggest newspapers and magazines distributor is diversifying into other areas as its core business wastes away. The recent £38m of an educational materials and stationary supplier is such an example of this. The shares also pay a chunky dividend yield of more than 8 per cent.

Family friendly pub group Marstons (MARS) is another business in a declining industry. However, pubs are disappearing as fast as newspapers and MARS has been successfully paddling against the tide of consumer concerns. This focus on food and value could enable the group, which is best known for its traditional ales, to withstand the general economic downturn. Further help could come if the rain goes away at some point soon to boost a potentially bumper summer featuring Euro 2012 football, the London 2012 Olympics and extra bank holidays from the Queen's Jubilee. There is also an attractive dividend yield of around 6 per cent.

Rolls Royce (RR.) has the sort of long term order book that makes lesser companies sick with envy and provides a visibility investors institutional and retail cherish. There is growing demand from emerging markets, which is forecast to continue. Another attraction is the possibility of increased servicing contracts on the aircraft engines due to greater demand for more fuel-efficient and greener aircraft, which should ensure that the regular flow of contract wins continues.

Having built up an excellent business in Asia, Prudential (PRU) will piggyback growth in the region directly, or could decide to float this arm in Hong Kong or China and hold onto a stake that will also enhance group value.

Finally there is the solid GlaxoSmithKline (GSK) shares have been climbing over the last 16 months providing investors with steady growth and yield attractions.

Momentum stocks

A short while ago Borders & Southern (BOR) looked like it might have hit oil. When this proved wrong, everybody got out, but after the fall its share price the traders are back as it turns out the company has hit gas instead of oil.

Short term traders we last week been buying Barclays (BARC) ahead of its trading update last Thursday.

Hedge fund manager Man Group (EMG) has been popular ahead of a trading update due on 1 May.

Investors have also been expecting a trading update from BP (BP.), out this week, will contain mostly good news.

Matra Petroleum (MTA) is a penny oil explorer that has attracted some speculative interest.

 

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Warning: Remember, particularly if you are new to trading in the stock market and in forex, that the prices of shares and other investments can fall fast and you may not get back the money you originally invested. The material here is for general information only and is not intended to be relied upon for individual investment decisions. Take independent advice before making such decisions. Also, the BullBearings free stock exchange simulation portfolios are a good way to practice trading techniques.

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