Broker tips: Morrisons, Prudential, Home Retail

3rd Sep 2012 11:24

Nomura has downgraded its rating for supermarket group Morrisons after analysing the recent Kantar grocery survey.According to the survey, Morrisons' volume growth lagged behind its counterparts by around 4% at the last data point."We recognise MRW's ability to preserve profitability, having faced volume headwinds from both Asda's Netto conversions (abating) and TSCO's reset (ongoing), and expect resilient H1 interims (September 6th). However, MRW's survey volume trend proves the tipping point for us to revise our recommendation to 'neutral' (from 'buy')," the broker said.Galvan Research and Trading has recommended to buy shares of insurance giant Prudential, saying that the stock's recent underperformance is 'unwarranted'."Although recent weeks have seen the market plump for sector peer Aviva rather than Prudential, Galvan Research regards the Pru as a 'buy' on the basis of the recent relative share price underperformance and the fact that the fundamental downside remains cushioned by very strong Asian growth," said Galvan's head of research, Andrew Gibson.Investec has upgraded its rating for Argos and Homebase owner Home Retail Group, saying that the firm's second-quarter trading statement next week could see a pick up in sentiment."While the market short position in Home Retail has retreated, it remains very high and we therefore believe the shares should react positively to evidence of more resilient trading at Argos," Investec said on Monday morning."With share price risk weighted to the upside in our view, we are therefore moving from 'sell' to 'buy', with a new target price of 109p (70p previously)."BC