Newspaper Tips & Round-Up

LONDON (ShareCast) - National Grid (LSE: NG.L - news) is the safest of the safe. Even for a utility, it has a risk-averse investment model. At the moment, 95% of its revenues are from regulated services.

Last week's confirmation that a major ratings agency was taking the outlook back up to "stable" is a key development and leaves the stock undervalued. At current levels the shares yield 6.8%. Given this, the improving ratings and the safety first business model, National Grid is a buy says the Independent.

National Grid shares are now trading on a March 2010 earnings multiple of 9.8 and remain a buy for their solid, safe dividend adds the Telegraph.

If the consensus view on Pearson (LSE: PSON.L - news) 's earnings is raised to 57.7p a share, the lower point of the company's guidance, the shares will be trading on a forward multiple of 11.8 times. This does not seem high considering the defensive nature of its education portfolio, which has proved itself in the first half. Shares in Pearson remain a buy says the Telegraph.

After March's £1bn rights issue, Wolseley (LSE: WOS.L - news) 's balance sheet has been fixed — albeit at the price of substantial dilution to shareholders. Its Ferguson business is also heavily geared to US economic recovery (it accounted for more than a third of last year's sales). However, at £12.20, the shares have more than doubled in four months to trade at 20 times next year's earnings — a rating fully capturing their near-term potential. Take profits says the Times (1832.HK - news) .

Currency movements have not done any favours to Beazley (LSE: BEZ.L - news) , the Lloyd's insurer which yesterday reported a 55% drop in half-year profit. Barring major catastrophes - always a risk with at Lloyd's - Beazley is in a good position and should go well from here. The shares are not expensive, trading at 110% of net tangible assets, a small premium that does nothing to reflect the growth that should come through over the coming months. Buy says the Independent.

Five months after Beazley raised £150m through a rights issue, the money is already spent. In the US, which now accounts for about half of its business, Beazley has a sound platform for growth. At 106½p, or four times Numis's estimate of next year's earnings, tuck away says the Times.

Dialight (LSE: DIA.L - news) , the small-cap Cambridgeshire electronics specialist, recently secured a $12m order from a US telecoms operator for strobes for mobile phone masts. Given a potential American market of 80,000 towers, and its status as the only supplier to have so far passed Federal Aviation Administration tests, Dialight is hopeful of more. At 149p, or 11 times next year's earnings, the shares do not look cheap. But Dialight has net cash, a 4.2% dividend yield and 2010 forecast profit growth of 60%. Buy on weakness says the Times.

With the markets showing signs of recovery fund manager Aberdeen Asset Management (LSE: ADN.L - news) is of some interest says the Independent, but on a 2010 multiple of 14 times earnings, the shares are not cheap. The sector, by comparison, is on 12 times. Sell, and look again when the price eases the paper says.

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