Broker tips: BP, Melrose, Morrison

16th Nov 2012 11:32

Nomura has maintained its 'neutral' rating and 455p target price for oil giant BP following Thursday's 4.5bn-pound settlement with US regulators.The broker said that in order to become more positive on BP, it would need to see a greater evidence of an "operational and financial turnaround"."An upstream day in December will provide a framework, but we maintain a turning point for E&P is unlikely till 2014."Investec has pared its target price for industrial group Melrose from 270p to 260p after Friday's disappointment, but has reiterated its 'buy' rating for the stock, saying that the long-term outlook for the business is positive."Longer term, we still expect Melrose to offer above average revenue growth with the prospect of margin upside (predominantly from [recent acquisition] Elster)."UBS has cut its recommendation for supermarket giant Morrison from 'buy' to 'neutral', saying that the stock's sector premium is perhaps not appropriate right now.The broker highlighted that the trading momentum has fallen "alarmingly adrift of the competition" in recent months. UBS is concerned that Morrison could struggle to diagnose and effectively sort out the underlying issues.BC