Broker snap: Hammerson too defensive

23rd Feb 2011 12:10

UBS says that retail real estate group Hammerson is too defensive relative to its peers, and despite results beating expectations, the broker remains cautious.After 2010 earnings per share (EPS) came in 2% above the broker's estimate, it raises the EPS forecast for the current year by 3% to 19p.UBS notes that while Hammerson is well placed to benefit from a UK/French retail recovery with a solid property and financial base, it has a lower exposure to Central London (11%), a lower earnings yield and gearing, relative to its sector peers."Given its size this could change relatively quickly, but we prefer to reserve judgement until we see which route for growth the group takes."The target price is raised from 450p to 480p to reflect above-estimate earnings, but the 'neutral' rating is kept in place.