Wednesday tips round up: Wood Group, Cairn Energy

Oil services firm Wood Group delivered a “creditable” performance so far this financial year, the Financial Times’ Lex wrote.

In its latest interim results, Wood Group delivered higher profit margins despite a collapse in oil investment, flattered by a couple of one off income gains.

The company deserved applause, Lex wrote, and the market obliged as shares recovered after an initial sell off.

Lex said the UK company cut its employee count by 13% last year and management increased its promise to find savings of £20m to £80m.

“Barring any lasting recovery in the oil price, holding markets where they are will be management’s next trick,” Lex said.

The Times’ Tempus advised buying shares in Cairn Energy, as the explorer has no production at the moment.

“It is the silver lining of not having any revenue: your income cannot take a battering from the price of oil,” the above column said.

Tempus said production was not far off, and the company was fully funded through to when the oil and cash start flowing.

“Growth prospects in Senegal and imminent North Sea cash flow make Cairn a good place to wait for normality to return to oil,” Tempus said.