Broker snap: Home Retail rally prompts Nomura reassessment

4th Aug 2009 11:17

Broker Nomura has taken another look at Argos and Homebase owner Home Retail Group after shares in the firm rallied in line with a brighter economic outlook. Nomura raises its price target on the stock to 330p from 288p, but given the rally in the share price, also downgrade's Home Retail to a 'neutral' rating. It notes that Home Retail is still trading at a price/earnings ratio of 16x. "Home Retail Group is executing strongly, offers a secure 4.7% dividend yield and a robust balance sheet; however, we see greater opportunity including self help measures across the sector," Nomura says.