Sunday share tips: ITV, Homeserve

Buy shares in ITV, said the Sunday Times' Inside the City column. The broadcaster has lost over 39% of its value this year, with the shares losing ground even before the TV advertising market was hit hard by the EU referendum decision, which sent the big advertising sectors like retail, travel, banking and insurance scurrying back into their shells. The BBC showing the Olympics also was not good for viewer numbers in the summer, while ITV's share of rights to last year's Rugby World Cup meant this year's comparisons have been tougher.

On Thursday, boss Adam Crozier broadcasts the FTSE 100 group's quarterly trading update and many investors have already switched over to something else. City brokers suggest sales could tumble 9% in the fourth quarter. But like a blood-and-guts TV crime show, the drama has perhaps been overblown and ITV remains a big attraction for advertisers as no other advertising slots can offer 5m viewers as it often does. As well as an increasingly diverse revue base from its programming sales overseas, Crozier has also announced plans to cut £25m of costs. The shares are far form highly rated and also yield 7%.

Homeserve shares were tipped as a rewarding long-term investment by Midas in the Mail on Sunday. Although HomeServe still has a bad name for some people due to a misselling scandal that led to it being fined £30.6m by regulators in 2014, founder and still chief executive Richard Harpin has brought many investors back on side since. The company, which provides households with cover against emergencies such as leaky pipes and blown-up boilers, has over 2m UK customers, helped by partnerships with more than a dozen water companies.

But Harpin has his eyes on a potential step-change in growth from expanding overseas, including the USA, where Homeserve has built up 2.7m customers and added 0.4m more with the recent acquisition of rival Utility Service Partners for $75m, which also brings a deal with the National League of Cities, which serves local authorities and water companies, adding access to 66m homeowners. If Homeserve enjoys its usual 10% success rate in selling to water companies, then this could add more than 6m customers. Poland, Japan, Brazil and China are all potential new markets for the coming years, while new technology like the Leakbot, which insurer Aviva has agreed a deal over, could provide another revenue stream.