Despite all the doom and gloom of the current financial crisis, there are some good opportunities for investors in the market.

That is if LOM Securities' (Bermuda) Bermuda Stock Exchange (BSX) domestic issuers' Blue Book, which was written by the company's investment advisor and chartered financial analyst Jeremy Dyck and financial analyst Grant Hopkins, is to be believed.

The Royal Gazette was given an exclusive sneak preview of the book, which was published this week, and gives an overview of companies listed on the BSX, with a brief description of each, 2007 and half year and third quarter 2008 results, forecasts and recommendations.

The book features big hitters such as Butterfield Bank, Argus Group Holdings, Belco Holdings, KeyTech and BF&M, as well as small cap firms like Bermuda Press Holdings and Stevedoring Services.

Mr. Dyck and Mr. Hopkins have been collaborating on the project, with the former, who is now based in Nassau in The Bahamas, having experience of compiling last year's edition and the latter, who is on the ground in Bermuda, working on the research side.

Mr. Dyck said the biggest difference between the 2007 version of the book and this year's offering was the change in the economic climate.

"Obviously there have been a lot of challenges in the equity markets worldwide and with the economic situation globally we are pretty much in a recession right now," he said.

"We have cut back on earnings targets and we have seen big problems with some of the financial companies.

"Bermuda is of course very dependent on the insurance industry as well as IT and obviously the prognosis on those has not been great. But we do see some value in certain areas of the market."

He said that the most recent numbers in the book related to the end of October, but the market had fallen in the past month since then, with the BSX dropping by 27 percent to 30 percent over the year, reflected in Butterfield Bank declining from a share price of $18 to $11, Argus from $15 to $10, BF&M from $21 to $17. But Mr. Dyck reckons the signs of recovery should be seen a year from now, in terms of the BSX issuers and the broader global markets.

"A lot of people held these BSX stocks for the dividend yield and obviously some of them may have to cut back on their dividend now," he said.

"But we are looking at a five to eight percent yield on these stocks and a lot of investors, especially the private ones, are holding them for their yield and they are looking pretty juicy at the moment."

As far as bargains were concerned, Mr. Dyck said that a number of companies' stocks were trading close to their 52-week lows and recommended five companies to buy, including BF&M, KeyTech, Bermuda Press Holdings, Watlington Waterworks and MediaHouse.

The rest of the companies were recommended as 'holds', while there were no 'sells' listed in the book, he said.

"It is hard to recommend selling some of these stocks at these prices," he said.

"The biggest buy would be BF&M - they have adapted to the mark-to-market rules. As far as other stocks that we like, Bermuda Press looks interesting, with a yield of nearly seven percent, and the share price is down to $11, which is half of the book value.

"KeyTech is down to a share price of $9.50 and it is pretty much a value thing - most of their divisions are performing better than last year, and if it does not cut its dividend you are getting over six percent on yield, while it is completing its next generation network and the new submarine cable should help them in terms of offerings and service."

But he cautioned a 'hold' for Butterfield Bank because of the mortgage- and asset-backed securities it held, as well as low interest rate environment making it hard for the bank to make the same returns as it had in previous years.

Meanwhile, with the current credit crunch putting pressure on capital for construction projects across Bermuda and the uncertainty over the future a number of insurance companies based in Hamilton, such as American International Group and XL Capital, and low demand for offices, Mr. Dyck believes investors should 'hold' on stocks in developers West Hamilton Holdings for the moment.

Belco, with its list of capital projects in the offing and a predicted big increase in demand in electricity over the next 10 to 20 years, allied to healthy cash flow and income, is also recommended as a 'hold', while Bermuda Commercial Bank with a lack of a new buyer and deposits dropping mainly as a result of mutual fund redemptions, is another 'hold'.

"I think in this environment we have to be a little bit conservative," said Mr. Dyck.

"There is not a whole lot of appetite for risk right now and we have seen PE and earnings ratios come down, with a lot dependent on how deep the recession goes.

"But there are some good buys out there based on valuation metric or dividend yields.

"Equally, if you own the stuff there is no sense in selling at this value, especially if you are earning a good dividend."

To obtain a copy of the Blue Book visit LOM's website at www.lom.com or for individual company reports drop into its offices at 27 Reid Street, call 292 5000 or email info@lom.com.