Broker snap: Weir's results should be taken 'positively', says Investec

31st Jul 2012 10:41

In spite of the poor market reaction to Weir's interim figures on Tuesday, Investec has retained its 'buy' recommendation for the Scottish engineering group, saying that the results 'should be taken positively'. Shares fell after the firm said that full-year profits are likely to come below market expectations is there is no pick-up in the upstream Oil and Gas markets. However, seeing as though its pre-tax profit guidance is still for £440-460m, Investec has left its forecast for £451m unchanged.First-half revenues came in at £1,325m, up 29% year-on-year and ahead of the broker's £1,259.8m estimate. Meanwhile, adjusted pre-tax profits of £226m beat the £214.9m prediction.Investec said: "No major surprises, even if Oil and Gas is expected to be a little weaker, so results should be taken positively."The broker uses Weir's international peers to derive its price target (currently trading at 12.5 times next year's earnings), which is lifted from 1,770p to 1,850p.By 10:40, shares were down 2.93% at 1,654p.BC