Broker tips: Unilever, Wolseley, African Minerals

1st Oct 2013 11:49

Nomura has retained its 'buy' rating for consumer products giant Unilever but has cut its estimates following a sharp slowdown in growth in the third quarter."The medium-term story of improving margins, better cash generation and a more effective sales organisation remain in place. However, consumer trends in emerging market have deteriorated much more than we anticipated and developed markets also remain challenging (in part ongoing Proctor & Gamble aggression we think)."Jefferies has reiterated its 'underperform' rating for plumbers merchant Wolseley despite a strong performance in the US driving annual results ahead of expectations.The broker highlighted that the company's statement contained more overt references to US new residential markets than before. "Though this could simply be a reflection of the increasing size after a period of growth, we are mindful that it could perhaps indicate a shift in management focus towards these higher growth/lower margin markets," it said.Credit Suisse has downgraded its rating for London-listed iron-ore producer African Minerals (AMI) from 'outperform' to 'neutral', saying that the risk/reward in the near term is now more finely balanced.The bank said it sees risks from "1) lower iron ore prices in Q413 and from 2014; 2) risks of delay to the Tewoo deal; 3) operational downgrades and product pricing concerns equivalent to over 100p/share that continue to present risks to consensus earnings and valuation".BC