Broker tips: Int'l Power, Michael Page, Marston's

11th Jul 2011 13:00

Matrix has kept its hold stance on electricity company International Power following the proposal by the Australian government to implement a carbon tax starting at A$23 per tonne."The long-awaited Australian carbon tax has been a key issue for International Power; however, following the GDF Suez merger the impact of any such tax has been severely reduced," said analyst Adam Forsyth."While this is positive in the case of a carbon tax, it is negative when it comes to adding new projects as the company will struggle to find enough opportunities to create a meaningful growth beyond that already factored in," Forsyth added.The shares have fallen back from the broker's target price of 328p, but it "see[s] little to chase at the moment."Merchant Securities has retained its buy recommendation on recruitment firm Michael Page International after the group's second quarter trading update was ahead of consensus.Second quarter net fee income (NFI) was £147.8m, compared with the broker 's forecast of £136m. While this was still largely driven by permanent contracts, the growth rate in temporary contracts rose from 14% to 24% quarter-on-quarter. Merchant ups its full-year NFI target by 6% from £535m to £566m."With some forecasts ahead of guidance and others below, the shares will probably remain broadly unchanged after this update. Retain buy," he said. The target price stays at 625p.Credit Suisse has upgraded brewing and pubs group Marston's from neutral to outperform and raised its target price to 131p, from 116p, saying that the firm has "attractive growth prospects [coupled with] yield support."While the broker's forecasts for the year ending 2 October remain broadly unchanged, earnings per share (EPS) estimates for the following two years (ending 2012 and 2013) are raised by around 7%, driven by better trading a lower tax charge.The new target price offers a 23% upside to the current share price.Credit Suisse also ups its estimates for sector peer Greene King after factoring in higher acquisition and capital expenditure which is expected to drive growth in the managed pub estate.EPS forecasts for the years ending (May) 2012-2014 are upgraded by 3-10%. However, a neutral stance is retained, with the broker noting just 3% upside to the new target price of 521p (462p previously).BC