Broker tips: RBS, InterContinental, SSE, Resolution

2nd May 2014 12:43

Shares in RBS jumped on Friday after the company beat forecasts with its first-quarter results as pre-tax profits doubled. Analysts, however, chose to remain cautious on the outlook for the UK bank.Richard Hunter, Head of Equities at Hargreaves Lansdown Stockbrokers, said that the quarterly performance was "respectable", but the bank is still in the midst of dealing with its legacy issues and warned of higher costs later in the year due to restructuring and the possibility of further regulatory fines.Similarly, Analyst Ian Gordon from Investec said that while the results offered "welcome relief" for shareholders, "all is not quite so rosy" as the 'beat' would suggest.Killik & Co has maintained a 'buy' recommendation for Holiday Inn and Crowne Plaza owner InterContinental Hotels Group after a "strong set of first-quarter results" from the company."We remain positive on the shares, given the potential for growth driven by economic recovery, an attractive pipeline, margin enhancement and balance sheet utilisation."UBS has hiked its target price for SSE from 1,475p to 1,620p and maintained a 'buy' rating, saying that the utility group's dividend yield is both highly attractive and sustainable.The bank said that dividend yields across the European utilities sector are "increasingly attractive" yet "SSE's 6% divi yield and real growth policy is a standout".Resolution's share price was making gains on Friday after Credit Suisse upgraded the stock from 'underperform' to 'neutral', saying that it sees a "greater balance of risk and opportunity" ahead of the insurer's first-quarter update next week.Credit Suisse expects Resolution to "soothe investor concerns" on May 7th regarding the recent political and regulatory developments in the UK life and savings market.BC