Broker tips: Tate & Lyle, Homeserve, St James's Place

3rd Nov 2011 12:41

Panmure Gordon has raised its target price for sweeteners firm Tate & Lyle from 615p to 645p after the group's first half profits beat expectations.Pre-tax profit rose by 38% from £136m to £180m, ahead of consensus estimates of £163m. As such, Panmure's pre-tax profit forecasts for the current year have been lifted from £303 to £315m and from £315m to £320-325m next year.However, with the stock trading at 12 times earnings, the broker keeps its hold rating.Three days after downgrading Homeserve's rating from hold to sell, Pell Hunt has slashed its target price for the emergency repair services firm from 450p to 280p, saying that an "FSA investigation looms".Homeserve saw its shares plummet by over a quarter on Monday after audit firm Deloitte found "processes that did not meet the company's required standards." The firm responded by saying it has started "an immediate re-training programme for its telephone sales staff and is developing new scripts." "We believe the FSA won't be able to be seen to sit on the sidelines and allow Homeserve to deal internally with an issue that could possible relate to miss-selling to consumers," said analyst Henry Carver.UBS has downgraded FTSE 250 wealth management group St James's Place from buy to neutral, saying that yesterday's solid quarterly update is overshadowed by an cautious outlook."St James's Place has been the best performing life insurance stock in the world this year and is the best managed domestically focused life company. However, it is not immune from market forces and macro uncertainty is beginning to affect its momentum," UBS said.However, the broker does note that yesterday's news on the Lloyds management team (with its chief executive taking a temporary leave of absence) suggests that there is less change of a decision on their 60% shareholding in St James's Place, "reducing overhang concerns".The target price is cut from 407p to 353p.BC