Sunday tips: Imperial Tobacco, Britvic, Cluff Gold

Investing in tobacco companies is not to everybody's taste, but the valuation of Imperial Tobacco at the moment looks pretty compelling - especially for income-seekers says the Telegraph.

Last week, the company tabled a third quarter update that disappointed the market - although the shares had been falling ahead of the announcement. The shares are trading on a September 2010 earnings multiple of 110.4 times, falling to just 9.6 next year, which does not look expensive. The current-year prospective yield is 4.5%, rising to 5.1% in 2011, which is attractive. Investors seeking income should use the recent weakness as a buying opportunity.

Last week, Britvic said it was confident in meeting full-year expectations as it posted third quarter sales. Total revenue rose 16.2% on a year-on-year basis to £289.5m. Sales for the year to date are up 8.5% to £794.8m. There was a hint of caution in the statement. "We continue to remain cautious about consumer sentiment in our trading territories," it said. Now is the time to take profits and sell says the Sunday Telegraph.

Cluff Gold received an unsolicited offer in February but the share price has fallen back to 73p since the bid discussions ended. At this level, the Africa-focused gold miner is undervalued, with the share price taking no virtually no account of the Sierra Leone mine Baomahun's short or long-term potential. Buy says the Mail on Sunday.

The time needed for regulatory approval for Reciktt Benckiser's bid for SSL will give any rival suitors ample opportunity to come in with an offer. While this is improbable, investors should hold on just in case says the Mail on Sunday.


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