UK: Good as gold - hot investment tips for 1991. (7 of 10)

UK: Good as gold - hot investment tips for 1991. (7 of 10) -

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Last Updated: 31 Aug 2010

Definitions.

Dividend cover: Number of times after-tax profit covers total dividend payout.

Dividend yield (%): Gross dividend payout per share divided by share price multiplied by 100 (at November 26 for good bets, November 20 for rest).

Gearing (%): Total long and short-term debt divided by share capital and reserves less intangibles multiplied by 100.

Interest cover: Number of times operating profit and non-trading income cover interest payments.

Market capitalisation: Number of shares multiplied by price per share.

Net cash: Total cash and equivalents (including short-term investments) less total borrowings.

NTA (net tangible assets): Share capital and reserves less intangible assets.

p/e (price earnings) ratio: Price per share divided by earnings per share.

Total assets: Sum of all assets less current liabilities.

Ten good bets for bad times

Company (activities) p/e Gearing Total Market Dividend

ratio (%) assets capital yield

(£m) (£m) (%)

Abbey National (banking) 12.9 10 2,721 2,974 5.2

Allied-Lyons (brewing, 13.3 96 4,466 3,795 4.5

distilling)

British Gas (oil and gas) 12.0 46 8,792 10,139 6.2

British Telecom (telephone 10.8 55 14,251 17,768 5.7

networks)

Fisons (pharmaceuticals) 11.0 84 509 2,542 2.4

Marks and Spencer (general 15.8 30 2,729 6,414 3.7

retailing)

Sainsbury (food retailing) 13.8 70 1,968 4,474 2.9

SmithKline Beecham 16.4 - 2,067 3,940 3.1

(pharmaceuticals)

Tesco (food retailing) 14.6 27 1,655 3,652 2.7

Unilever (processed food) 11.4 95 6,914 7,048 2.5

Source: Datastream.

Ten good bets for the recovery

Company (activities) p/e Gearing Total Market Dividend

ratio (%) assets capital yield

(£m) (£m) (%)

BPB Industries (building 8.4 2.9 681 741 8.3

materials)

British Steel (steel) 4.8 8 453 236 9.6

Carlton Communications 7.0 49 337 608 5.7

(television production)

Dixons Group (retail, 13.0 69 587 598 4.8

property)

Simon Engineering 9.0 62 222 244 7.4

(engineering)

Storehouse (general 33.0 38 624 512 5.3

retailing)

RMC Group (building 8.0 25 1,026 1,265 3.8

materials)

THORN EMI (entertainment, 10.0 104 2,037 1,884 6.3

retail)

TI Group (engineering) 7.3 19 739 639 6.0

Willis Corroon (insurance 12.0 59 308 1,036 7.0

broking)

Source: Datastream.

Ten good bets longer term

Company (activities) p/e Gearing Total Market Dividend

ratio (%) assets capital yield

(£m) (£m) (%)

British Airways (airline) 3.8 119 2,041 1,006 8.5

Cable and Wireless 11.3 29 3,335 4,318 3.4

(telephone networks)

General Electric Company 9.5 29 3,406 5,176 6.4

(telephone electricals)

Guinness (brewing, 16.8 94 4,298 6,710 2.9

distilling)

Lloyds Bank (banking) 16.8 96 4,973 3,582 6.4

P and O (shipping, property) 10.4 78 3,353 2,164 7.8

Reuters Holdings (news, 13.6 43 533 2,789 2.9

information)

Rolls-Royce (engineering, 9.5 21 1,602 1,509 6.2

aerospace)

Trusthouse Forte (hotels, 16.3 36 3,437 2,099 5.9

retail)

Source: Datastream.

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