Broker snap: Credit Suisse optimistic at Marston's, Greene King

11th Jul 2011 12:18

Credit Suisse has upgraded brewing and pubs group Marston's from neutral to outperform and raised its target price to 131p, from 116p, saying that the firm has "attractive growth prospects [coupled with] yield support."While the broker's forecasts for the year ending 2 October remain broadly unchanged, earnings per share (EPS) estimates for the following two years (ending 2012 and 2013) are raised by around 7%, driven by better trading a lower tax charge."We believe Marston's offers a combination of strong EPS growth [...], driven by organic growth through newbuild sites in the managed business and self-help in the tenanted business, as well as an attractive dividend yield [...] which is amongst the highest and arguably the most visible of our Travel & Leisure coverage universe," the Swiss broker said.The new target price offers a 23% upside to the current share price.Credit Suisse also ups its estimates for sector peer Greene King after factoring in higher acquisition and capital expenditure which is expected to drive growth in the managed pub estate.EPS forecasts for the years ending (May) 2012-2014 are upgraded by 3-10%.However, a neutral stance is retained, with the broker noting just 3% upside to the new target price of 521p (462p previously).BC