Broker tips: IMI, ENRC, Bovis

20th Aug 2012 12:59

Jefferies has downgraded its rating for engineering giant IMI from 'buy' to 'hold' ahead of the group's first-half results on Thursday. "Ahead of these results, we lower FY12F & FY13F earnings per share (EPS) by 4% and 2% (cutting underlying assumptions and updating forcurrency) and fear that consensus is too high still. The market may be favouring the cyclicals for now, but we prefer to revisit lower down." With earnings at Eurasian Natural Resources Corp (ENRC) expected to weaken, Credit Suisse has lowered its recommendation for the stock from 'outperform' to 'neutral' and reduced its target price from 500p to 450p.The broker sees two key risks: "1) earnings are likely to weaken substantially over the next 12 months (we think consensus is 50%+ too high next year); 2) an equity raise cannot be ruled out and we expect investors to remain on the side-lines pending clarity on the restructuring path." Panmure Gordon has upgraded its full-year forecasts for Bovis Homes after the house-builder's interim results came in ahead of expectations. "Whilst our recommendation remains 'hold' on valuation grounds, it is clear that the group is making strong progress against a stable market backdrop," Panmure said. BC