Broker tips: British Land, Land Securities, Computacenter...

31st Aug 2011 12:58

Assuming negative net asset value (NAV) growth in the UK in the next 12 months, Morgan Stanley has downgraded real estate investment trust (REIT) peers British Land and Land Securities from overweight to underweight, causing shares to take a tumble on Wednesday. "We think it is unlikely capital values are set to rise when most of the West faces a significant risk of a recession," the US brokerage said. After lowering 2012 NAVs by 13% in the UK, Morgan Stanley has slashed its price targets by over 30% for the two FTSE 100 giants, after applying a wider target discount to lower NAVs on the back of increased risk. British Land's price target was scaled back from 730p to 480p, while the target for Land Securities is cut from 980p to 680p. UBS has kept its buy rating on IT infrastructure services and solutions provider Computacenter, saying that the firm now has a "better balanced business model".The broker notes that the second half has started solidly, after the firm indicated that July and August trading has been good, with a particularly strong performance in Germany. Meanwhile, the UK has been helped from more favourable comparatives and has a good managed services pipeline.However, the target price is cut from 520p to 500p. "A more prudent view of the macro environment leads us to slightly lower our forecasts for 2012."Peel Hunt has kept its hold rating on online gaming firm bwin.party after a set of "reassuring" first half results that came in at the top end of estimates. However, the broker has highlighted its worries over a potential shut-out of Germany following regulatory concerns in the country. "We would like to see management be more open about the potential impact from a potential German shut-out and what plan B might be," analyst Nick Batram said. Peel Hunt also notes that costs are rising and "it remains to be seen how effectively the group will perform in newly regulated markets."The target price of 162p has been placed under review. BC