Expert View: ITV, Petrofac, Centrica, Carillion & Avingtrans

Apologies for the different layout for Expert View today.  Harry Brooks is away.  Please click on the share tickers to see the company information and factsheets. 

ITV impresses with special dividend

ITV (ITV.L) delighted investors with a £156 million special dividend after the commercial broadcaster increased full-year profits by 13% to £520 million and hiked adjusted earnings per share by 16% to 9.2p.  Three years into its transformation plan, chief executive Adam Crozier said every department had grown and contributed to the bottom line. 

Richard Curr, head of dealing at Prime Markets, said: 'While the rapid share price growth in some way reflects this progress, ITV is still very much work in progress, and along with most analysts, Prime Markets believes there is more to come.  As such, the momentum from the impressive result and the ebitda [earnings before interest, tax, depreciation and amortisation] growth today should continue to drive the share price higher to our four-week price target of 130p.  Buy.' 

ITV shares fell 1% of 1.25p to 119p after Crozier dampened takeover speculation in the wake of Liberty Global's bid for Virgin Media.  He said ITV had not been approached. 

Next: Petrofac punished for vagueness

Petrofac punished for vagueness

Shares in Petrofac (PFC.L) slumped more than £1 or 6% to £14.96 after the oil services group narrowly missed 2012 profit forecasts, invested heavily in its new offshore division and refused to to be pinned down over its forecast for this year. 

Commenting before the company's presentation after the results, James Evans of Cannacord Genuity said: 'Petrofac has pointed to somewhat vague guidance of "good growth" in 2013, vs our forecast of 12%.  We think this guidance is satisfactory given that there is still some uncertainty on $3 billion of work in MENA [Middle East, North Africa] awaiting contract signature.' 

Evans said the shares traded at 11.7 times his forecast earnigns for 2013 and 10.4 times for 2014, in line with its sector average. 

Next: Centrica, 'cheapest of the utilities'

Centrica: 'cheapest of the utilities'

Cantor Fitzgerald retained its 'buy' rating on Centrica (CNA.L) after the energy group increased adjusted pre-tax profits for 2012 by 15.4% to £2.38 billion, in line with expectations. 

Centrica has come under criticism after its British Gas subsidiary posted a 9% rise in profits after pushing up household energy bills by 6% over the winter. 

However, Cantor analysts were impressed with the firm's financial grip.  Adjusted earnings per share rose 5% to 27.1p.  The full-year dividend advanced 6.5% to 16.4p. 

Cantor's target for the shares is 403p.  They closed at 345.6p, down 3.5p or 1%. 

Analyst Angelos Anastasiou said: 'The figures are much as expected with the overall cash flow even stronger than we had forecast; and our early thought on the strategic update is that this probably holds few surprises.  We reiterate that despite a decent run since mid-November, we belive that Centrica remains the cheapest of the UK utilities.' 

Next: Carillion can't do it, says Liberum

Carillion can't do it, says Liberum

Analysts at Liberum Capital repeated their 'sell' advice on Carillion (CLLN.L) and set a 235p target price for shares in the construction and support services firm, 26% below their currrent level of 311.4p, down 6p or 1.9%, after its final results. 

The group made an underlying pre-tax profit of £214.7 million last year, down 4% on 2011, as it cut back its UK construction business in response to the downturn.  This was ahead of most analysts' forecasts but Joe Brent and William Shirley of Liberum said the profits had been flattered from gains of selling businesses and that net debt of £155.8 million had been worse than expected. 

Next: Avingtrans continues to transform

Avingtrans continues to transform

David Buxton of FinnCap said the half-year results from Avingtrans (AVG.L) showed the £26 million engineering components group was part-way through a transformation that was focusing it on higher margin and higher quality businesses in aerospace.  Turnover from continuing operations rose 19% to £16.9 million with earnings (ebitda) up to £1.1 million from £1 million. 

'With further balance sheeet capacity to make additional acquisitions, which should be taken positively; we believe the shares have further good value,' said Buxton. 

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