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Market Watch

FINANCE

SHARES in Tyneside listed construction group Amco are continuing to surge despite thin volumes.

Michael Parkinson, an analyst at house brokers Brewin Dolphin, said: 'There are more buyers than sellers for Amco even though there are not many buyers.

'Shares started to motor the day after the Olympics was announced but I still don't think they look that cheap.'

Mr Parkinson is forecasting a £1.5 million leap in annual pre-tax profits at Amco to £4.5 million, which works out at earnings per share of 27p and puts the stock on a price to earnings ratio of 6.5.

Amco usually rises in tandem with Tyneside contractor Tolent, as the pair share a majority owner in Amco Investments.

This company owns 51 per cent of Amco shares and is controlled by the family of founder Henry Schmill, who passed away last year.

Amco Investments also has a majority stake in Tolent but these shares gained just tuppence to 232p last week despite a forecast from Brewin Dolphin predicting unchanged profits.

Mr Parkinson added: 'Tolent is also going up but Amco looks cheaper in terms of price-to-earnings ratio.'

Elsewhere, recent gains at Jarvis were all but wiped out by a woeful set of results from the one-time contracting giant.

Among the materials firms, Baggeridge, the UK's fourth largest brickmaker, dived after a profits warning.

This, plus concern about the state of the housing market, saw shares in rival Michelmersh also sag.