Companies: CSN    DISL    NFDS   

A positive year-end update from acquisitive caravan retailer Discover Leisure prompted Panmure to reiterate its buy recommendation and set a 29p target price. Recent acquisition Barrons, which now brings in 60 per cent of sales, is integrating successfully and will bring beneficial cost savings. Analyst Charles Hall believes there is ‘significant share price upside as the company further consolidates the industry and monetises some of the property value’.

In the food sector, Andrew Saunders points out the attractions of Northern Foods. A 30 per cent price fall since February has left the shares trading at a 48 per cent discount to his 140p target price. Saunders lauds the approach of new chief executive Stefan Barden and argues that with ‘an active focus on capital management’, the company ‘looks set to transform its returns to investors’.

Disposals leave Northern ‘ready to drive new growth with a portfolio of businesses that have good market positions and create value’. Noting that the prospective price to earnings ratio drops from 12.4 this year to 8.9 in 2009, Saunders upgrades from hold to buy.

Chesnara gets assurance
Similarly, life assurance group Chesnara receives the broker’s blessing on the back of a ‘strong’ 17 per cent rise in interim profits. Analyst Barrie Cornes argues that the share price implies the company is trading at ‘a mere 0.9 times embedded value, which we believe to be wrong considering that other closed life funds such as Abbey (even though it is much larger) have recently been acquired at a premium of 1.04 times, rather than a discount to embedded value’. He urges clients to buy.