Morrisons
Immediately following the announcement that Morrisons (LSE: MRW) (NASDAQOTH: MRWSY.US) was looking for a new CEO, its share price rallied by around 4%. Clearly, the market is ready for change and, while the appointment of the next CEO may not cause its shares to surge, a new strategy could do so, as has been the case at sector peer, Tesco.
And, with Morrisons trading on a yield of 4.9%, it seems to offer good value for money and the scope for a share price rise. For example, were its shares to trade on a yield of 4% (which would still make it a very appealing income play), it would equate to a share price gain of 21.6%. While this may not take place in the next few weeks, a new strategy plus a stabilisation in its sales decline could prompt investors to buy Morrisons and push its share price to 225p or above.
Imperial
Although the outlook for the global economy is more upbeat now than it has been for a considerable amount of time, the Eurozone could still cause investors to remain somewhat cautious in the months ahead. That’s why Imperial Tobacco (LSE: IMT) (NASDAQOTH: ITYBY.US) could be a great stock to own, since its sales are likely to improve whatever the economic weather.
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Furthermore, Imperial has expanded its e-cigarette operations with the acquisition of Blu (the biggest e-cigarette brand in the US) and this could persuade investors that it is a much more internationally focused operation which, therefore, offers better diversification than it has in the past.
And, with Imperial having a dividend yield of 4.6%, it seems to offer excellent value for money. In fact, it would be of little surprise for investor demand for its shares to rise so that it yields 3.5% — especially given its consistent and above-average growth prospects. Such a level would mean that its shares would trade around 30% higher than at the present time, which could be achievable this year.
Centrica
Like Morrisons, Centrica (LSE: CNA) is undergoing a period of change at the present time, with its new management team set to put in place a new long term strategy for the business. This could involve a greater focus on its exploration arm since, although the price of commodities has fallen, it could help Centrica to diversify and lessen the effect of political risk on its share price.
In fact, the prospect of an energy price freeze and new regulator under Labour has been a major drag on its share price. And, should Ed Miliband not become Prime Minister, it would be of little surprise for Centrica’s shares to make strong gains this year. With them having a yield of 5.8%, it has the scope to move over 20% higher and still yield a whopping 4.8%. This highlights just how cheap they are right now.
