MARKET TALK: UBS Initiates Chemring At Buy

23rd Jul 2010 08:00

0700 GMT [Dow Jones] UBS initiates Chemring (CHG.LN) at buy with a 3600p target. Reckons the group will continue to grow earnings at circa 20% per annum over the next two years. Adds the company's current valuation reflects concerns over the outlook for defense spending and potential margin pressures. "We believe management recognizes this long-term threat, and is positioning Chemring accordingly by looking to diversify into areas where defense spending is expected to continue growing, and investing in new facilities and products that are less dependent on current levels of conflict," adds UBS. Shares closed at 2959p Thursday. ([email protected]) Contact us in London. +44-20-7842-9464 [email protected] (END) Dow Jones Newswires July 23, 2010 03:00 ET (07:00 GMT)