The Telegraph's share tips for 2016

Ashley Armstrong

Clipper Logistics, which floated on London’s junior market in 2014, is tapping into one of the most important trends in the retail sector. It is effectively the plumbing behind John Lewis’s and other retailers’ click and collect services. However, what makes it really interesting is its so-called “Boomerang” service, which processes returned goods. The convenience of online shopping means items that don’t fit or aren’t suitable are sent back. British retailers lost £130m from the cost of handling returned items on Black Friday alone and with around 35pc of all goods bought online sent back to shops, the level of returns is only going to increase. The shares are riding high already, up by almost 70pc this year, but Clipper added Zara and South African billionaire Christo Wiese’s Pep&Co to its list of clients this year, and further wins are expected.

Julia Bradshaw

Fruit and vegetable purveyor Total Produce is a well-established company perfectly positioned to grow through acquisition in a sector that is ripe for consolidation. The dual-listed British/Irish producer distributes more than 300 million cartons of fresh fruits, vegetables and flowers to retailers and wholesalers across Europe and North America each year. While the sector is mature, growing at about 1pc a year, Total’s strategy of growth through acquisition has yielded bumper returns in recent years. The group’s strong balance sheet means it has the power to pluck smaller players from the market. Despite four acquisitions in North America over the past two years, analysts reckon Total has the muscle to spend €300m (£220m) over the next five years. There are risks, not least geopolitical disruption and inclement weather. But these are more than outweighed by the growth prospects, underpinned by favourable demographic trends. The shares, trading on just over 13 times forward earnings, are priced at an undeserved discount to a sector average of 15.

Recruitment firm Hays is on the list of top picks for 2016

Marion Dakers

Hays

The recovery in the jobs market has delivered some spectacular returns for recruitment companies, with some providers, like Staffline, seeing their shares rise 80pc. Hays has been left out of this rally, barely ending up flat on the year, as investors demurred at its heavy exposure to Europe and the ailing mining industry. Hays’ global reach in white collar jobs means it makes just a third of its earnings from the UK, while its biggest market is Germany, where it has worked since 2003 to develop business in a country that uses an agency for just one in five vacancies. Even though its worldwide operations make it vulnerable to currency movements, with a 9pc rise in fees last year stripped back to 5pc by foreign exchange translations, its share price has perhaps unfairly lagged its fellow mid-cap recruiters such as Michael Page. The company has also said it will consider a special dividend in the coming year.

Ben Marlow

Dixons Carphone

Now could be a great time to buy shares in Dixons Carphone, the high street electricals giant formed out of the merger of Dixons and Carphone Warehouse 18 months ago. The deal was initially greeted with some scepticism in the City. However, as the integration of the pair nears its final stages, the benefits are showing. Dixons Carphone recently smashed forecasts with a set of first-half numbers showing pre-tax profits surging 23pc to £121m. Performance was strongest in the UK, where market share has been boosted by the demise of big rivals such as Comet and Phones4U, and 2016 promises much. The City is particularly excited about ambitious attempts to crack the US with a chain of mobile phone stores, which Investec analysts estimate could boost earnings by £65m. The launch of a new home gadgets emergency service could also prove to be inspired. The shares have only gained 6pc in 2015 but could take off next year, with momentum clearly building under its highly regarded boss, Sebastian James. Analysts at Royal Bank of Canada have a price target of 550p.

Ben Martin

InterContinental Hotels Group

Investors looking for stock market returns should check in to the FTSE 100 giant behind the Crown Plaza and Holiday Inn chains, which has been a strong performer in recent years. At the time of writing, IHG stock stood at £26.05, more than one and a half times the £10.36 at which the shares started 2010. In what has been a poor year for the FTSE 100, IHG is only down a modest 1pc, against the 7.6pc slump in the wider index. A number of factors should serve to push the shares higher in 2016. In September IHG completed the sale of its Hong Kong property for $929m (£625m) and is now widely expected to return the proceeds of that deal and more to shareholders. IHG has pledged to update investors about cash returns at its full-year results in February. The expectation of further consolidation in the hotels industry should also support the shares. Hopes that IHG will make a transformational acquisition, or will receive a takeover bid itself, may drive the stock higher in 2016.

2016 could be a good year for InterContinental Hotels Group  Photo: Heathcliff O'Malley

James Quinn

Barclays

As Barclays’ third chief executive in the space of three years, Jes Staley could be forgiven for thinking that his time at the bank may be limited. But after the caretaker manager that was Antony Jenkins, the Boston-born Staley has a mandate to really shape the bank in his image. Contrary to some commentary at the time of his recruitment by chairman John McFarlane that his arrival would mean Barclays boosting its investment bank, what it means is that Barclays will keep its wide-ranging remit, with a focus on retail, corporate and investment banking. But what Staley will do is make those divisions work harder, and smarter. The reining in of Barclays’ global ambition will continue, as Staley focuses on growing profits and doing what Barclays is good at. That is not to say he will not face headwinds, not least the likely conclusion of the Serious Fraud Office’s investigation into its Qatar share sale at the height of the financial crisis. But investors could do worse than to back Barclays in 2016.

Alan Tovey

Inmarsat

For Inmarsat, troops going into action is good for business. The company is likely to benefit from the increasingly fraught situation in the Middle East, and if land operations start, expect the Western military to drive a big increase in demand for the satellite communications it provides. Another factor is the work to provide in-flight broadband. The European Aviation Network system will not generate revenue until 2017, but more airlines getting on board will lift the shares. The GlobalXpress network coming fully online will also boost revenues. It could also announce capex in a new generation of satellites, starting a regime of constant investment rather than the current lumpy approach. The strength of the business is illustrated by the heady P/E ratio – around 30 times – but now is a good time to get into a very long-term play.

Tim Wallace

Standard Chartered

Standard Chartered has not been a good buy in recent years. Since its peak in early 2013, the share price is down two thirds, from £17.34 to £5.25. This was a dramatic turnaround for a bank that survived the financial crisis in a position of strength, as it suffered a series of problems including a slowdown in its core markets in Asia, fines from US regulators, bungled investments in South Korea and fears over the suitability of its capital buffers. Some of those problems have been solved, or at least addressed, and a management clearout has left the bank with a new chief, Bill Winters, and an almost entirely changed executive team. Winters has wasted little time improving the capital position with a $5.1bn (£3.4bn) rights issue and slashing costs, with a plan to chop 15,000 jobs. He is also spending an extra $1bn a year on compliance in a bid to put an end to the stream of legal woes. The slowdown in emerging markets remains one potential weak spot, but overall, they are still growing more quickly than developed economies. Together this could – eventually – put an end to the long slide in the share price. Failing that, prolonged weakness could see a rival launch a takeover bid, again lifting the shares.

Times have been tough for Standard Chartered, but investors have high hopes for new boss Bill Winters  Photo: Bloomberg News

Christopher Williams

Vodafone

Britain’s biggest telecoms company had a funny 2015. Significant progress in its own operations, emerging from years of decline in Europe, was overshadowed by the will-they-won’t-they discussions it held with Virgin Media owner Liberty Global. Going into 2016, the same improving trends are in play, and given the share price made no progress this year it seems reasonable to expect some appreciation for its recent return to earnings growth. The Liberty question will probably come to the fore again, but Vodafone’s hand in the negotiation is strengthening, meaning that with or without a deal the shares should rise. By summer 2016 Project Spring, the massive network capital expenditure programme, should have come to an end, giving investors more confidence that Vodafone’s chunky yield can be maintained. Its operations in southern Europe should see continuing improvement and it is well placed to benefit from the shift to bundling mobile with broadband and pay-TV. The expected IPO of the Indian business should also attract new investors. Its position in the UK is weaker, but there is hope of a big boost from Ofcom’s review of the market. Sky’s arrival in the mobile market will present a new threat, however, and price wars are possible. But barring major mis-steps, 2016 ought to be a decent year.

Jon Yeomans

Finsbury Foods

One of the UK’s largest bakeries, Finsbury Foods has a big slice of the cake market, and recent acquisitions leave it well placed to gobble more. It has an extensive range of licensed products, including a deal with Disney to supply, among others, Frozen, Marvel and Star Wars-branded cakes. It also has a line in organic and speciality bread, such as the Vogel’s brand. Having overcome a major restructuring, cleaned up its balance sheet and splashed out on automation, Finsbury has seen its share price climb steadily in the past two years. But it is still trading at a discount compared with its peers, and its price arguably does not fully take into account its earnings potential. Finsbury operates in a tough space, with food-price deflation forcing supermarkets to put the squeeze on suppliers. But it has gained some protection by going after the food-service industry, becoming a supplier to cafe chains such as Costa. Sales of cakes surged by £30m in the UK this year, according to Nielsen, breaking the £1bn mark. Britain’s sweet tooth is good for Finsbury, and there is room for it to grow further.