Broker tips: BT, BSkyB, RBS, Shire

11th Nov 2013 12:10

UBS has maintained its 'sell' rating for BT after the company won the exclusive rights to the UEFA Champions League and UEFA Europa League for three years, raising concerns about the price it paid to secure the deal.The bank said that the company is taking market share but at a large cost, with the£299m-per-season representing 130% inflation and 20% higher than the cost of the Premier League rights. It believes that content inflation is now a "significant risk" and said it expects Sky to "hit back via DSL and fibre price cuts".Meanwhile, British Sky Broadcasting was trading firmly in the red after BT's UEFA deal and a downgrade by Nomura from 'buy' to 'reduce'.The broker said that BT's willingness to overpay for the UEFA deal is "worrying for Sky and a bad sign for the next Premier League auction".Analysts at Jefferies think little of the received wisdom that the creation of an internal bad-bank at RBS has kicked the investment case for RBS into the long grass. Quite the opposite: they believe that, if anything, visibility on returns for the Core business increases as does its fundamental capacity to pay a dividend from 2015. Panmure Gordon has raised its target price for Shire from 2,850p to 3,100p, after the firm's acquisition of rare disease biopharmaceuticals firm ViroPharma.The broker admitted that the $4.2bn price tag for the US company was at an "eye-watering multiple" - with the enterprise value being valued at 7.6 times revenues - but said it is "strategically very sound".BC