Shares digital

Cadbury Schweppes (CBRY) 584p

Shareholders have been disappointed by the refusal to return capital from the demerger of its US drinks business. (Read the full story: www.sharesmagazine.com/node/3306)

Shares says: Cadbury’s has reneged on its promise to give investors some cash from the deal through a special dividend. Analysts are not impressed. Neither were investors as the news prompted a sharp sell. HOLD

The Times says: The anticipated return was relatively modest: some 25p, or less than double the total 15.5p dividend for 2007. Nor should Cadbury be castigated too severely for failing to spell out the precise improvement in margins in confectionery it expects this year: its target of a mid-teens return on sales by 2011, from 10% last year, is intact. Revenues from confectionery were up 7% last year and are forecast to rise by up to 6% in 2008. Near-term demerger prospects, which will highlight confectionery merits, should underpin the shares at 579p. But at 17 times’ current-year earnings, they can be only a hold for now. HOLD

The City - Evolution says: The confectionery business will see rapid earnings growth following both topline growth and restructuring-driven margin advances. ADD