Charles Stanley downgrades Direct Line to reduce

11th Aug 2015 09:39

(ShareCast News) - Analysts at Charles Stanley downgraded insurer Direct Line Group to 'reduce' from 'hold', and advised investors to take profits.The brokerage moved its price target up to 387.8p from 350p. Shares in Direct Line were trading at 383.7p at 0951 BST, having lost 1.06% since the market opened.Charles Stanley analyst Minal Shah said in a note it would be prudent to take profits, despite ongoing bid speculation buoying the insurance sector.Shah said Direct Line had delivered a strong first half performance, aided by benign weather which may not continue.The analyst said shares in the company had already delivered about 41% total return since mid-December 2014 and had outperformed the FTSE 100 by about 32%."We struggle to see the stock delivering the same level of outperformance in the near term (absent a takeover approach), with potential c.15% downside to what we would consider to be fair valuation as a standalone going concern."