Broker tips: BT, Misys, GAME

3rd Feb 2012 11:27

Nomura has maintained its buy rating on BT, saying that the telecom titan's trading momentum is building nicely for 2012.BT now expects to achieve its EBITDA target of above £6,000m this year, rather than in 2013."With consensus already sitting at £6.01bn for FY 12, we expect marginal upgrades to at least reflect the robust trading performance," the broker said.Nomura kept its target price of 285p.Merchant Securities has given financial software provider Misys a sell rating and 220p target price following the news that the firm is in talks with a suitor."No details are yet known as to the above announcement from Misys (beyond the all-share element), but we see this as borne out of increasing risk to consensus second half estimates," said Merchant analyst Roger Phillips."Our investment thesis remains that Misys is reliant on continual M&A activity, with questionable returns for the deals of the past, to cover for abject organic performance," he said.Shares in struggling computer gaming retailer GAME Group surged on Friday morning after it confirmed revised terms have been agreed with its lenders, but Peel Hunt has maintained its cautious stance on the stock.GAME also said that the losses in the year to January 31st will not be as bad as expected. The full-year loss before tax and non-recurring items will be around £18m, well below Peel Hunt's previous forecast of a loss of £30m."Clearly, trading and opex savings have not improved. We can only assume that stakeholder support from key suppliers may have yielded some form of 'over rider' or volume discounts to improve year-end margins," said analyst John Stevenson.Peel Hunt reiterates its hold rating and 5p target price.BC