Broker snap: Growth estimates scaled back at WPP

3rd Jun 2011 12:22

Nomura has reduced its full-year revenue assumptions for advertising and marketing group WPP as growth in April appears to have slowed slightly after a stronger first quarter. "The trading statement for the first four months of the year showed organic growth of 6.2% vs. 6.7% for Q1 [first quarter] 2011. This implies April growth was less than 5%, meaning there has been a downward slope since the start of the year," the broker said.The broker takes into account that April may have had a tougher comparison than the first quarter and was hit by events in Japan and the Middle East. Combined with tougher comparatives ahead, Nomura now considers a sub-5% growth rate more likely. The organic growth forecast for the full year is cut from 6% to 4.7%.However, a 'buy' rating and 1,000p target price are retained.---BC