Broker tips: Burberry, Moneysupermarket.com, Safestore

8th Jul 2011 12:50

Credit Suisse kept its neutral rating and 1,310p target price for luxury brand Burberry, despite expecting the group to report another strong quarter on 13 July.The broker forecasts sales of £342m for the first quarter, an increase of 23% on the same quarter the year before. This figure will be driven by a 34% underlying rise in retail, 9% underlying increase in wholesale and a 5% underlying improvement in licensing.However, following a 20% rise in the share price over the last three months, the broker maintained its neutral stance.Peel Hunt placed its target price and recommendation under review for price comparison website Moneysupermarket.com following the firm's strong first half trading update.The group said that overall revenue in the six months ended 30 June grew 23% to £88.3m, "suggesting [like-for-like] growth in Q2 was as strong as Q1, despite the comps becoming harder," said analyst Malcolm Morgan.As such, the broker raised its pre-tax profit for the current year from £41.4m to £44.4m. "In the light of the upgrade and the strong top line growth, we place our target price and recommendation under review."Matrix downgraded storage space provider Safestore from buy to add, and reduced its target price from 160p to 150p, saying that it is going to "continue being a tough market for the self-storage operators over the next year."However, the broker believes that the current share price is an "attractive entry point" for investor who can take a medium-term view.Nevertheless, "the risk to our view is that the economic outlook worsens and, consequently, occupancy rates do not recover to meet our expectations."BC