Friday tips round-up: Ashtead, BP alternatives, Consort Medical

Though plant hire group Ashtead raised its dividend by more than expected, the 2.9p-a-share payout is not covered by earnings.

The shares remain one of the stock market's best plays on US economic recovery. But at 110Œp, down 3œp, they are up with events. No more than a hold says the Times.

Promising stories like this are often undone by the valuation, but Ashtead's shares are not expensive. On a mid-cycle basis, discounting back from estimates for 2013, the shares end up a on multiple of 4.2 times in terms of enterprise value to Ebitda. That compares favourably to usual mid-cycle metrics of 4.5 to 6 times. It's worth investing in Ashtead now, before the recovery spreads its roots and the market re-rates the shares. Buy says the Independent.

WS Atkins draws 70% of its sales from the UK and the outlook for infrastructure spending remains bleak - as underlined by yesterday's move by the Government to cancel or suspend £11.5bn of projects. As it is, the company's work in hand, at 54 per cent of budgeted revenues, has remained reassuringly steady year-on-year. The other prop is the puniness of sterling, which could encourage bid interest. At 695œp, or ten times earnings, and yielding 4%, hold on says the Times.

If Consort Medical is seen as a low-growth stock with a chunky dividend yield, yesterday's full-year results did nothing to change that view. Both underlying revenues and operating profits - at £118.6m and £18.6m respectively - barely budged in the 12 months to April 30.But the prospect of vigorous profit growth appears no closer than before. At 355œp, or nine times earnings, a 5.4% dividend yield remains as attractive as ever - but that is not enough reason to buy. Pass says the Times.

Consort's outlook is more positive than the numbers. However, if punters accept the potential of the Bespak products, there is a cheap stock on offer here. Trading on a 2010 price-earnings ratio of 9.2 times, Consort is inexpensive. The dividend yield of 5.3% alone justifies buying shares. Assuming that the company is not a basket case, and Consort isn't, investors should be supporters of the stock, so buy says the Independent.

The Telegraph has recommended five companies that could be replacements for BP in an income portfolio. The five are: National Grid, Royal Dutch Shell, Vodafone, Scottish and Southern Energy and RSA Insurance.

There could be significant opportunities for contractor Balfour Beatty, which stands on an attractive price of 7.6 times estimated full-year earnings. Balfour Beatty is a good recovery play, but wait to see further signs of a significant return of global infrastructure opportunities. Hold says the Independent.


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