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Serco (SRP) – Finals PTP: £114.6m (£107.4m) Divi: 3.02p (2.55p)

The outsourcing major has used its UK expertise as a springboard to gaining overseas contracts, including a correctional facility in Australia and operator of the Dubai metro transport network. It signed £3.6 billion of contracts and is preferred bidder on a further £1 billion. Serco retained its accolade of winning 90% of all re-bid contracts, and winning one in two new contracts.

Earnings visibility is excellent, with 91% of 2008’s planned revenue secured, 76% for 2009 and 63% for 2010.

There is high expectation for increased nuclear-related work, with Serco involved in numerous UK clean-up projects.

Serco has proved to be a resilient stock, recovering fast from the two significant market falls in August and January.

Shares says: Not cheap on a 2008 PE of 21, but worth the premium rating for solid performance.

by: Dan Coatsworth