Thursday tips round-up: Rexam, Domino's, L&G

Rexam's core canning business stabilised in the final months of 2009, with European can volumes flat year-on-year in the last three months of 2009 after high single-digit declines in the first nine months.

The sales decline in North America improved to minus 2 per cent in the fourth quarter, a figure in line with long-term trends. The cherry is the expectation that Rexam will increase its dividend from 8p this year to 12p. If you've already bought in to the story, hold on for the recovery, says the Times.

Domino's was touted by some as one of the big winners of the recession - but it looks as if it will be a winner in the recovery as well. The company has accelerated its new store opening plans to 55 a year from 50 and management are upbeat on prospects. Because of the proven business model, the demand for franchises and its ambitious expansion plans, the shares remain a buy, according to the Telegraph.

With more than 90 per cent of sales still coming from the UK, Legal & General remains exposed as a domestic player and has had to fend off Resolution, Clive Cowdery's predatory bid vehicle, in recent months. The yield, at an estimated 5 per cent for this year, is healthy but below that of its European peers. The shares, which have lost ground since last month are showing signs of a rebound. Hold in the hope of more excitement, writes the Times.

Despite the concerns about both the Middle East and the UK public sector, WS Atkins is sufficiently diversified to remain attractive on a purely business case. But the big draw of the stock is its valuation. The shares trade on a multiple of next year's forecasts of just 8.1 times falling to 7.7 times, according to Panmure Gordon. That is well below the sector average. And the group's enterprise value to earnings ratio is 2.9 times, the lowest in the consulting sector. Add in the 5 per cent dividend yield, and WS Atkins starts to look very attractive. Atkins is a strong buy, writes the Independent.

Thorntons, the chocolate maker insists that the decline in retail sales was a blip, not a trend. But in the long-run, much will hinge on how successful it will be in lease negotiations with landlords. Mike Davies, the chief executive, signalled yesterday that its multichannel sales approach- it can reach market through the internet, other retailers or its own stores - meant that it could take a tough-minded position with landlords. It also raised its dividend yesterday after a cut last year. At ten times next year's earnings, at last night's price, Thorntons is worth a nibble, says the Times.

Coal is a dirty word in environmental circles - but that does not mean it is going to disappear any time soon. Yesterday's interim numbers from Hargreaves Services were exceptional. The company tabled record profits, despite a near-30pc fall in revenues. The roll-out of the planned Rocpower plants and the potential for increasing business in Europe means that the growth story is still intact. Buy, says the Telegraph.

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