Broker snap: Senior's shares are cheap, says Investec

23rd Jul 2012 11:31

Investec has reiterated its 'buy' recommendation and 250p target price for aerospace engineer Senior on the back of a strong first half and inexpensive valuation."Senior's interims are excellent and whilst the outlook statement is cautious, the long-term fundamentals of the group have never been stronger," the broker said.Revenues, EBITA (earnings before interest, tax and amortisation) of £50.7m, adjusted profits and earnings per share and the interim dividend are all had of Investec's forecasts."In normal circumstances we would be upgrading, however given the macroeconomic backdrop, we will not be changing forecasts at this stage (which now implies second half profits down on the first half)."The shares are trading at 10.2 times next year's earnings, which Investec labels as "inexpensive for a group offering strong growth prospects in a low growth environment".Nevertheless, shares were down 1.25% at 182.2p by 11:30.BC