One to watch: Electrocomponents

Electrocomponents latest trading update was awaited with some nervousness after disappointment from one of its principal competitors.

However, this proved unduly cautious and the statement was reassuring. The key to the company's prospects is the ability to satisfy consumer demand rapidly and efficiently as well as being in the vanguard of innovation.

One recent development is DesignSpark, a website designed to bring together engineers. The service includes free software so its customers can design three-dimensional models for new systems and, once the design is completed, identify the serial numbers for each component, making it easy to order the parts.

The recent setback in the share price has left Electrocomponents on an undemanding prospective price-to-earnings ratio of less than 12 and offering a dividend yield of close to 5 per cent. This could be an opportunity to conduct further research on a first class company at the core of global economic activity.

Electrocomponents

239.3p -1.3p

Scotsman says BUY

• The value of your investment could fall and you may get back less than you invested. You should take professional advice if you have any doubt on the suitability of this stock for your portfolio.

BROKER SNAPS

GlaxoSmithKline

1,363.5p +22.5p

Broker says BUY

Ahead of today's interim results from drugs giant GlaxoSmithKline, Evolution carries a "buy" rating. Evo said: "The results should be uneventful – investors are aware 2011 is the trough underlying earnings year and we believe the results will provide the sense of reliable and predictable progress."

Yell Group

6.72p -0.28p

Broker says HOLD

RBS Equities remains "sceptical" about Yellow Pages publisher Yell Group and has cut its target price from 10p to 7p. The broker added: "Management is targeting 75 per cent of revenue from digital by 2015. However, with print revenues in free-fall, it may get there by default as much as by design."