Broker tips: GKN, BAT, Moneysupermarket.com

31st Jul 2013 11:00

Investec has raised its rating for engineering group GKN from 'add' to 'buy' following its first-half results on Tuesday, saying that the stock deserves a higher rating."Interim results served to remind the market of GKN's attractive mid- and long-term growth prospects," said analyst Andrew Gollan. The stock trades at 10.9 times 2014 earnings, which is "still undemanding despite recent share moves", the analyst said.Nomura has reiterated its 'buy' rating and 4,000p target price for British American Tobacco (BAT), saying that it delivered on the 'classic underlying growth profile for a tobacco company' in the first half."The ability of BAT to get sufficient pricing to offset that volume weakness is the sign of a well placed tobacco name, in our opinion," Nomura said. "We see BAT continuing to move the dial on pricing effectively to offset inevitable volume volatilities, thanks to its geographic exposures, leadership positions and equity in the portfolio.Canaccord Genuity has downgraded its recommendation for price-comparison website Moneysupermarket.com from 'buy' to 'hold' despite an in-line set of interim figures, pointing out that the stock has risen 45% so far this year.Analyst Simon Davies said that while it met forecasts, "challenges remain" in the second half: "not least a sharp year-on-year decline in motor and home insurance premiums in H1 (which may reduce the savings from switching). And H2 has not started well, with July revenues 'flat' year on year."BC