Broker tips: Close Brothers, Gulf Keystone, Entertainment One

14th Sep 2011 11:21

Shares in banking, securities and asset management firm Close Brothers were dragged lower on Wednesday after UBS scaled back its forecasts and reiterated its cautious outlook for the industry.The Swiss broker said that since Close Brothers' trading statement in July, it has seen a more challenging macro environment in the UK and notes that market levels have dropped. As such, earnings estimates for 2012 and 2013 have been reduced by 11% and 13%, respectively.Due to the change to estimates, the broker cuts its target price from 780p to 700p. A neutral recommendation is kept.Evolution Securities has confirmed an add rating on Iraq-focused oil and gas group Gulf Keystone after the firm announced a significant increase in oil-in-place reserves in its half-year report. The company announced a 150% increase in proven reserves (P90) and a 45% increase in possible reserves (P10) for the Shaikan discovery, meaning that the range of reserves is now between 4.9bn - 10.8bn barrels (P90 - P10). "Progress has been swift and numbers look very encouraging, but the recent rapid rise in the share price suggests much has already been priced in," said analyst Richard Griffith.Evolution maintains its target price of 200p.Peel Hunt has maintained its buy rating on film and TV content distributor Entertainment One following its confirmation that the company is up for sale.Press reports have suggested that an offer could value the group at around £400m or 215p a share. This price would represent a 32% premium to Tuesday's closing price of 163p, which Peel Hunt says is in line with the historic take-out premia in the sub-sector."In our view, this level of premium for the company is justifiable, given the attractive business model operated by the company and its ownership of valuable content IP," said analyst Patrick Yau.A target price of 226p is kept.BC