Broker snap: Cineworld a good income play

6th Jan 2011 13:37

Panmure Gordon recommends Cineworld as a reliable income stock, with strong cash generation and a well-maintained dividend yield of 5% making it worth a 'buy' rating.Cineworld's pre-close trading update for the year ended 30 December reported strong trading with total revenues up 4.7%. Even though the bad weather last month had a negative impact on both box office and retail revenues during the important festive period, the strong performance from the rest of the year means that profitability should be in line with expectations."Having spoken to management, we will not be making any change to our 2010E or 2011E PBT forecasts of £35.2m and £37.4m, respectively," Panmure says.It leaves the target price at 240p.