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Market Watch


WITH models based on using cash from contracting to fund house building and property work, Gleeson and Kier bear comparison but are enduring very different fortunes.

Shares in Gleeson fell earlier last week after taking a £16.6 million hit that prompted the firm to quit building work.

The site of another black hole in a contractor's accounts can sway investors away from similarly-run businesses but Kier gained after solid interims.

After the results broker Teather & Greenwood re-iterated a 'buy' rating on Kier, with analyst David Taylor citing the continued success at the regional contracting operation in generating cash.

He said: 'Focus on partnering and negotiated workloads has improved the quality of construction turnover and this is beginning to show in reported margins.'

Elsewhere among the contractors Mears slipped as some investors took profits after the social housing maintenance firm produced forecast-busting results last Tuesday.

Despite the short-term share price fall the City remains content with Mears'performance.

Broker Arbuthnot raised its price target to 275p and edged the earningsper-share forecast up by 0.9p to 11.9p, while retaining a 'buy' rating.

Glass-making giant Pilkington also gained after boasting of a 15 per cent rise in annual profits for the year to March 2005.

The firm, which will detail the figures to the City on May 26, has been helped by energy surcharges on products in Europe and the USA.These have helped offset rising energy prices and slower UK trading.