Thursday tips round-up: Robert Walters, Galliford Try

9th Jan 2014 11:08

Recruitment specialist Robert Walters's latest quarterly update was quite intriguing. Fee income in the latest three months was up by nine per cent once currency factors are taken away. That looks encouraging enough. Does that tell us something about the state of the economy? Perhaps not what one would think. The company's Chief Executive and founder, Mr. Walters, believes it is too soon to draw the conclusion that confidence has returned to its business customers. Rather, he believes the above figures only reflect that demand is growing in a few hotspots, such as high-tech industries. There is also demand to be seen from companies that were forced to cut their staffing levels to the bone during the recession and now have to take on staff again. Given that the firm's speciality is in recruitement for senior roles, demand for which might be expected to increase when business confidence returns, Walters should know. Having said that, the main trick for investors looking to invest in the sector comes down to 'getting in' before the cycle turns - as the market starts to look for an improvement. Yet a glance at the share price graph suggests that that boat may already have sailed. Selling on 34 times' this year's earnings. Walters is well positioned at the top of the market, but that valuation looks full enough, The Times' Tempus says. Construction and home building outfit Galliford Try is a 'buy.' True, concerns about whether we are again in a house price 'bubble' are a formidable obstacle for investors trying to glean whether they should get in to the shares or not. However, Wednesday's figures from the company revealed just how profitable government initiatives such as Help to Buy have been for the housebuilders. So, indeed, the company did sell fewer homes in the second half of last year than in the previous comparable period. Prices for those homes sold nevertheless increased by 16% to £288,000. As well, the firm has a solid pipeline of orders in its construction business and Galliford's Chief expects margins in the segment to trough during the next six months. The stock's price soared in 2013, taking them back to near the record highs seen in 2007. In the absence of any other information investors should focus on the results they have in front of them," The Daily Telegraph's Questor team recommends to its readers. ABPlease note: Digital Look provides a round-up of news, tips and information that is impacting share prices and the market. Digital Look cannot take any responsibility for information provided by third parties. This is for your general information only as not intended to be relied upon by users in making an investment decision or any other decision. Please obtain a copy of the relevant publication and carry out your own research before considering acting on any of this information.