Broker tips: Tesco, G4S, Moneysupermarket.com

21st Jun 2013 11:29

Nomura has said that things are starting to look a bit better for UK supermarkets, as it reiterated its sector preference for grocery giant Tesco.Tesco still remains Nomura's firm favourite as it kept a 'buy' rating and 430p target price. The broker highlighted that the company has still been able to post volume gains in grocery (on a one- and two-year basis) despite the headwind from the horsemeat scandal, and said that the recent fall in the shares over the past month "represents an opportunity".Panmure Gordon has cut its rating for security solutions group G4S from 'buy' to 'hold' and slashed its target price from 311p to 252p, saying that the shares are 'finely poised' between the bull and bear cases."The new management team clearly have a lot of work to do in order to clean up the portfolio, reduce balance sheet gearing and prove to the market that its medium term margin guidance of 7.0% is achievable," the broker said.Westhouse Securities has upgraded its rating for price-comparison website Moneysupermarket.com from 'neutral' to 'add', saying that the stock offers good value following recent weakness.The broker said that the group's valuation now "understates its attractive fundamentals", adding that the company has the ability to benefit from a challenging environment for domestic spend and ongoing changes in consumer buying habits.