Broker snap: Investec downgrades BAE Systems over Salam deal

8th Nov 2013 11:15

Investec downgraded its rating of BAE Systems from 'buy' to 'hold' amid concerns of the over a Saudi jet fighter deal.The broker said it worried negotiations over a Saudi order for 72 Typhoon jet fighters, known as the Salam deal, could fall through."BAE remains relatively inexpensive, while continuing to offer an attractive yield," said Investec analyst Chris Dyett."However, as we near the end of 2013, we are increasingly concerned that the Salam pricing agreement slips through yet another year end (which would have a major impact on CY13E EPS and cash) and that there is a lack of near-term positive catalysts."The defence, security and aerospace company is also slashing 1,775 jobs at shipbuilding yards in Scotland and England.Shares fell 1.74% to 452.20p at 11:31 on Friday.RD