Sunday share tips: Aggreko, Stadium, Hiscox

LONDON (ShareCast) - (ShareCast News) - Shares (Berlin: DI6.BE - news) of Aggreko (LSE: AGK.L - news) are worth holding, wrote Dannny Fortson in the Sunday Times' Inside the City column. New (KOSDAQ: 160550.KQ - news) chief executive Chris Weston took over in January and his review of the temporary power supplier is to be unveiled on Thursday along with interim results. A dose of redundancies and cost-cuts looks likely, with a new focus on efficiences. A profit warning nine days ago sent the shares crashing 15%. You could look for the positives and hope that with that out of the way and a big strategy rejig coming, better days may lie ahead. But Fortson is more cautious. While Weston's early shake-up, with three geographic divisions rearranged into two businesses are sensible, rivals are moving into Aggreko's once-overlooked niche. Its miner and oil prospector clients are under pressure, while other end markets are unpredictable. If Aggreko shares recover to their average 17 times forecast earnings, it would add nearly a pound to the current price, but it will probably take a while.

Midas in the Mail on Sunday said investors might want to hold shares in electronic component maker Stadium Group (LSE: SDM.L - news) , but top-slice a third. Under chief executive Charlie Peppiatt, who joined in 2011 as operations director and taking full charge in 2013, the company has endured tough times, sinking to just 35p in 2012 but has fought back. A previous provider to companies needing its power products, wireless components and touch screen equipment, Stadium has shifted increasingly into designing components for a few choice sectors: medical, security, transport and energy saving.

A £6m fundraising last week helped fund the purchase of Stontronics, a power firm that should significantly expand Stadium's customer base. Analysts expect a 48% increase in profits to £4m for 2015, with the dividend forecast to rise 29% 2.7p for the current year.

Insurer Hiscox is one to hold onto, argued Questor in the Sunday Telegraph, despite chairman Robert Childs fresh warning that "a prevailing mood of suspicion and scepticism" could mean state support of the financial and insurance sectors might not be repeated in future. The current calm in the Lloyd's of London specialist insurance industry due to a dearth of large disaster claims has put premiums under pressure but shielded insurers from trouble. In spite all the takeover bids last year for many of its sector rivals, five listed Lloyd's specialists - Amlin (LSE: AML.L - news) , Beazley (Other OTC: BEAZF - news) , Hiscox (Berlin: H2X3.BE - news) , Lancashire and Novae - remain independent.

First (Other OTC: FSTC - news) -half results showed 12% more premiums and pre-tax profits up 8.4% as the retail business offset a more lacklustre performance in the more competitive reinsurance market. The interim dividend was hiked 6.7% to 8p per share, but the firm cautioned new capital requirements for insurers could hit dividends. The shares, boosted by the potential for M&A are near record-breaking highs and, though Hiscox is one of the most diversified and well-run in the business, it is liable to fall to earth along with the rest of the market once claims rise.

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