Broker tips: Oil stocks, Diageo, AB Foods

20th Jan 2012 11:52

Credit Suisse slashed its fourth quarter earnings per share (EPS) across the global Integrated Oil sector, assessing its coverage on UK stocks Shell, BP and BG.For Royal Dutch Shell, Credit Suisse anticipates a "particularly weak" fourth quarter and cut its EPS forecast by 29%. An outperform rating is kept though.For BP, the broker has cut its fourth quarter EPS estimate by 9% but reiterated its outperform recommendation on the stock. However, one stock that withstood any fourth quarter downgrades was BG Group which remains Credit Suisse's 'focus list stock'. An outperform rating was maintained also.Investec has upgraded its rating on drinks giant Diageo from hold to buy ahead of the group's first half results due in a few weeks."There is a once in a decade opportunity to unlock inorganic value. And possible incipient leadership change is a potential catalyst. Despite strong relative performance in H2 2011, we see this as a 'growth defensive' with sound growth prospects and remaining room to re-rate," analysts said.Investec raises its target price to 1,700p.After strong-than-expected performance at Primark, UBS has raised its its price target for the retail chain's owner Associated British Foods which it marks as a buy."We believe our estimates to be well underpinned (by what continues to be a 'tight' global sugar market) and as management progressively get a better line of sight on the FY outturn we see the potential for upgrades," said analyst Alan Erskine.UBS's price target rises from 1,200p to 1,245p.BC