Broker tips: HSBC, Anglo American, National Grid

24th Aug 2012 14:41

Investec has retained it 'hold' recommendation and 590p target price for global banking giant HSBC, highlighting the recent rating outlook downgrade by Standard and Poor's and settlement rumours in the US."Whereas we acknowledge that neither of these developments are helpful, there really are much better reasons to switch out of HSBC - for example, our expectation of a US$1.1bn (6%) 'miss' against inflated consensus expectations for H2 2012e, or the still compelling investment opportunities offered by resurgent STAN and BARC," Gordon said.Jefferies has downgraded its rating for mining giant Anglo American from 'buy' to 'hold' in spite of yesterday's announcement that it had resolved the 10-month dispute with Codelco over assets in Chile.The broker highlights concerns about delays and capex overruns at Anglo's large Minas Rio iron ore project in Brazil. "While Anglo's recently revised guidance is that Minas Rio would first deliver ore in 2H 2014, we do not expect first shipment until 2016. Further delays at Minas Rio would likely be viewed negatively by investors, but may be inevitable."Meanwhile, problems about cost inflation and weak end markets have led to margin compression for Anglo Platinum and other South African platinum inures.Nomura has reiterated its positive stance about utilities group National Grid, saying that the firm remains a 'compelling growth story [with] rising visibility'."National Grid is the stock with the most exposure to UK transmission - an investment opportunity with increasingly visible, inflation-indexed returns, and an attractive 8% CAGR [compound annual growth rate] to 2021 - a rare combination in an uncertain, low real return environment," the broker said on Friday morning.BC