The Investment Column: Laird's fine focus makes it worth holding

Our view: Hold

Share price: 513p

(+50.25p)

The sale of Laird Group's security systems division yesterday to Greg Hutchings' Lupus Capital turns Laird into a focused electronics and technology business. The deal completes Laird's transformation from conglomerate to dedicated technology outfit. It started in 2000 with the sale of its automotive operation.

This leaves Laird supplying electronic components for consumer products as well as the automotive, defence and IT hardware industries. Analysts applauded Laird's latest disposal. They pointed out that there was little synergy between the company's electronics and security systems operation, a maker of security doors and windows.

The business had also served its purpose as far as Laird is concerned. For years, the strong cash flows it generates were reinvested in the electronics business. However, this unit is now not only big enough to stand on its own two feet but is growing at quite a pace. In the past three years, sales have soared fourfold.

As a result, Laird is able to return to shareholders £100m of the £242m it raised from yesterday's disposal. The rest will be reinvested.

Laird yesterday also unveiled a 33 per cent jump in annual pre-tax profits to £73m. With trading in the electronics markets that the group now focuses on still buoyant, the stock is worth holding on to.

Forth Ports

Our view: Hold

Share price: 2,100p (+10p)

Annual results from Forth Ports yesterday were far from impressive. The operator of Dundee, Fife and Tilbury ports reported a 5 per cent drop in its pre-tax profits to £55.6m. The poor performance was caused by a one-off event - three customers had simultaneously shut down their operations to carry out maintenance work.

Nevertheless, Forth shares staged a modest advance. Driving this was news that the value of its land bank, which consists of 400 acres of waterfront land near Edinburgh, had risen 6 per cent to £277m. This is a conservative valuation of the portfolio. Once it has been redeveloped, analysts believe the site could be worth as much as £400m.

Another reason for Forth shares holding up so well is the hope that the company will one day be taken over. Such a scenario is quite likely. The group is the last remaining listed UK ports operator. Given its extensive property portfolio, it would make a perfect acquisition for private equity which at present has record amounts of cash to spend on buyouts.

Chaucer Holdings

Our view: Buy

Share price: 98.25p (+5p)

Chaucer Holdings became the latest Lloyd's of London insurer to post a sparkling set of results yesterday, revealing a sevenfold rise in its profits due almost entirely to the benignity of last year's US hurricane season.

The industry took a hit of more than $50bn (£25.7bn) in 2005, after hurricanes Katrina, Rita and Wilma wreaked havoc on the US coastline. However, while insurance premiums rocketed as a result, none of the major Caribbean storms made landfall in 2006, helping the insurers to a bumper year.

Although premiums have held up in Marine and Property insurance - Chaucer's two biggest lines of business - 2007 is unlikely to be as easygoing. Nevertheless, Chaucer proved in 2005 that, with a disciplined approach to underwriting and reinsurance, it can still turn a profit even in the worst of years. Meanwhile, its third largest line of business, motor insurance, looks set to enjoy a recovery in profits.

Trading at less than six times forward earnings, and with a dividend yield of more than 4 per cent, Chaucer is undervalued.