Companies: BIZ    CPL    EOG    FDI   

Bizspace is a likely bid target

Tracy Mackenzie, one of the small cap experts at this Scottish finance house, is a fan of small business workspace provider Bizspace. She highlights its attractions as a potential acquisition target – five per cent shareholder Treffick Ltd is 'a potential predator' – and remains convinced of its ability to roll out its successful business model. In terms of valuation she believes that the group is trading at 'a significant discount to its peers' and deserves a re-rating.

Another business MacKenzie is keen on is Chapelthorpe, the fibres to wall coverings concern. Although earnings expectations for the full year have been reduced and the group is not expected to deliver much in the way of turnover growth, its cash generation remains strong, gearing is falling and Chaplethorpe's progressive dividend policy is expected to be maintained. The expected payout for the full year is likely to be in the order of 1p per share, a yield of 5.6 per cent.

In the oil sector, a range of companies gets the thumbs up from Bell Lawrie. South Africa and Botswana-focused Firestone Diamonds is favoured as the broker anticipates that 'a successful start to production at Bonte Koe [in South Africa, in May] will have a significant impact on the equity value'. Following a period of weakness, the recommendation has been moved from hold to buy.

Mackenzie is also bullish on Edinburgh Oil & Gas, which received DTI approval for its Buzzard Field development in November last year and which secured a $105 million corporate revolving credit facility to fund its share of the Buzzard development. On recent estimates, EO&G's interest in this field is worth between '£74.2 million and £111.3 million'.