MARKET TALK: UBS Boosts Burberry Group Target Price

19th Jul 2010 07:58

0658 GMT [Dow Jones] UBS raises Burberry Group (BRBY.LN) target price to 790p from 730p, following the company's announcement that it will buy out its Chinese franchisees. UBS sees this transaction as very positive for Burberry, given that it allows the group to directly operate its business in what is currently the Luxury sector's key market. Says the deal is expected to close in September, but its impact on FY '11 earnings will be broadly earnings neutral. "In FY '12, however, the transaction is expected to add approximately GBP20M to operating profit as Burberry starts focusing on implementing productivity improvements," adds UBS. Has a neutral rating on the stock. Shares closed at 800p. ([email protected]) Contact us in London. +44-20-7842-9464 [email protected] (END) Dow Jones Newswires July 19, 2010 02:58 ET (06:58 GMT)