Expert share tips this week

Here’s your round up of how the experts view key stocks this week.

Tesco, Merlin and Ted Baker are among the companies under the spotlight this week.

1. Tesco – HOLD

Symbol: TSCO.L

Index: FTSE 100

Tesco share price (Image: Google)

The supermarket chain has reported a 2.2% increase in like-for-like sales in the six weeks to 5th January – at a time when many retailers had slower Christmas periods.

Ian Forrest, investment research analyst at The Share Centre, believes the company’s efforts to become competitive are paying off.

“However, investors need to be conscious of the looming challenge of the Asda/Sainsbury tie-up,” he said.

2. Merlin Entertainments – BUY

Symbol: MERL.L

Index: FTSE 250

Merlin Entertainments share price (Image: Google)

The upcoming release of The Lego Movie 2: The second part is expected to give a boost to the company’s Legoland parks.

Ivor Jones, an analyst at Peel Hunt, believes it will increase visits to these sites and points out that shares are currently low relative to their history.

“Merlin has a global business with a multi-year growth plan underpinned by key brands,” he said.

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3. Ted Baker – HOLD

Symbol: TED.L

Index: FTSE 250

Ted Baker share price (Image: Google)

The retailer has reported sales growth of 12.25% for the five-week Christmas period, with store only like-for-like sales moving into positive territory for the first time in a while.

It comes at a time when an independent investigation is being carried out into the behaviour towards staff of chief executive Ray Kelvin, who set up the business in 1988.

John Stevenson, an analyst at Peel Hunt, said: “Without concerns over CEO Ray Kelvin, the shares would offer good value here and arguably still do on a medium-term view. However, we see short-term downside risk from potential management disruption.”

4. Morrisons – HOLD

Symbol: MRW.L

Index: FTSE 100

Morrisons share price (Image: Google)

The supermarket reported a 3.6% growth in like-for-like sales in its Christmas trading update, with CEO David Potts highlighting an improvement in customer satisfaction.

However, Graham Spooner, investment research analyst at The Share Centre, noted that competition concerns aren’t going away and management initiatives will take time to execute.

“For the time being we would suggest a ‘hold’ recommendation,” he said. “Long suffering investors should watch the situation closely as the retail environment remains crowded.”

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5. Jupiter Fund Management – HOLD

Symbol: JUP.L

Index: FTSE 250

Jupiter Fund Management share price (Image: Google)

The company’s assets under management fell by 11% in Q4 and investment performance was impacted by poor markets.

At the end of the quarter, assets stood at £42.7bn, with market movements reducing AUM by a more significant £3.5bn, pointed out Stuart Duncan, an analyst at Peel Hunt,

“We maintain our ‘hold’ recommendation but place our target price under review until we finalise our forecasts,” he said.

The information included in this article does not constitute regulated financial advice. You should seek out independent, professional financial advice before making an investment decision.

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