Thursday tips round-up: Carillion, Xstrata, Big Yellow

Carillion has been working to shed its traditional image as a construction company and accelerated the shift towards support services. The strategy appears to be paying dividends, at least according to yesterday's trading update. While economic uncertainties remain a worry for almost any business you care to consider, on valuation grounds alone Carillion appears to be worth an investment, so buy, according to the Independent.

Xstrata is building its own copper-mining franchise in southern Peru. Yesterday it announced that it planned to spend $1.47 billion (£967 million) developing its Antapaccay copper project. Xstrata shares were up 3.6p last night at 909.5p. Worth picking up on further weakness, says the Times.

Big Yellow posted a healthy 10 per cent rise in first-quarter revenues from its 51 wholly owned stores yesterday. Forward visibility in the self storage trade is fairly limited, but as far as Big Yellow can tell, trading is likely to remain reasonable until the seasonal slowdown in September, when students move into halls and home movers have usually sorted out plans. Moreover, management has done a good job of managing the balance sheet, and the company seems strong enough to deal with any short-term pullback in the economy.

The problem will be if the pullback is sharper and the recovery is put off for longer than seems likely. This may hold back the share price as market sentiment, already anything but inspiring, turns more bearish. As Morgan Stanley points out, the stock could be hit hard in a double-dip scenario. But the Independent wouldn't sell. Not just because of Big Yellow's strengths, but also because the stock trades at a significant discount to its March adjusted net asset value of 418p per share. Hold.

Lookers, the car dealership, posted what by all accounts was a robust trading update yesterday, with investors being put on notice for "record" half-yearly results. The update followed some unexpectedly buoyant car market figures from the Society of Motor Manufacturers and Traders earlier in the week and suggested that car retailers in general - and Lookers in particular - are on the path to recovery. The question, then, is whether this upturn will last. Hold, says the Independent.

Photo-Me shares are on about 12 times this year's earnings, which seems about right, says the Times.

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