UK MARKET TALK ROUNDUP: BROKERS COMMENTS

24th Jun 2010 08:23

Broker comments in the UK today. Compiled by Dow Jones Newswires Markets Desk, [email protected] Contact us in London. +44-20-7842-9464 [email protected] 0723 GMT [Dow Jones] Ambrian initiates coverage of Oxford BioMedica (OXB.LN) with a buy rating, and fair value of 24p. Analyst Chris Redhead is confident the biotechnology company can secure a deal for its experimental Parkinson's disease treatment ProSavin within nine months. Adds investors can also expect to see data from a promising eye disease program with Sanofi-Aventis (SAN.FR) in 2011. Redhead says the company is adequately-financed, with GBP25.3 million in the bank, but this isn't reflected in its share price. The company's gene therapy technology is "ground-breaking," he says. Shares flat at 11.5p. ([email protected]) 0711 GMT [Dow Jones] Go-Ahead's (GOG.LN) full-year pre-close trading is slightly behind Shore Capital's higher-end expectations. The brokerage says there's scope to nudge down its 2011 forecasts by GBP5 million due to a higher tax rate and more cautious forecasts in the rail segment. Buy recommendation. Shares -3.5% at 1273p. ([email protected]) 0657 GMT [Dow Jones] Shore Capital downgrades McBride (MCB.LN) to hold from buy following the company's subdued update, which showed flat FY sales. Says the primary sales slowdown has been in Europe, with the group citing weak retail sales across many markets, such as Spain, France and Holland, rather than any increase in competitor activity. Also notes management highlighted the growing impact from rising input costs. As a result, Shore foresees further pressure on margins, with costs recovery likely to be a 3-6 months process. Shares closed Wednesday at 179p. ([email protected]) 0648 GMT [Dow Jones] Goldman Sachs raises Weir Group (WEIR.LN) price target to 1550p from 1447p as it adjusts estimates to reflect stronger market recovery in '10, a stronger SPM business, and the Linatex acquisition. Raises '10/'11/'12 EPS estimates by 14%/8%/6% respectively to 91p/101p/112p. "We continue to view Weir shares as an attractive way of gaining exposure to the minerals, oil and gas and power generation sectors, markets we believe should enjoy attractive structural growth over the next cycle." Reiterates buy rating. Shares closed Wednesday at 1102p. ([email protected]) 0645 GMT [Dow Jones] Micro Focus International's (MCRO.LN) FY results are fine, says Panmure Gordon. Notes the license sales are stronger than expected. Says Nick Bray resigning as chief financial officer is a disappointment, but the shares look cheap on Panmure's unaltered forecasts of 12.1xPE. Shares closed Wednesday at 528p. ([email protected]) 0640 GMT [Dow Jones] DSG's (DSGI.LN) fiscal year debt level is higher than expected, Seymour Pierce analyst Freddie George says. Says results are at the top end of expectations and show that the group's store renewal plan is going very well. Believes the share will not move greatly on the figures. Buy rating. Shares closed Wednesday at 28p. ([email protected]) 0637 GMT [Dow Jones] Morgan Stanley nudges up Stagecoach (SGC.LN) price target to 210p from 205p following the company's better-than-expected FY'10 results. Likes the company due to its exposure to UK rail, where recovering passenger volumes and extra cost savings delivered further upside surprise in the results, and UK regional bus, where it continues to benefit from a benign regulatory environment. Adds financial leverage is also low, allowing scope for potential value-creating acquisitions or returning cash to shareholders. Keeps at overweight. Shares closed Wednesday at 191p. ([email protected]) 0625 GMT [Dow Jones] DSG International (DSGI.LN) posted a very good full-year performance, Shore Capital analyst Kate Calvert says. Says the results show the group has momentum, combined with its strong statement that profitability will continue to improve. "Their renewal program seems to be hitting the spot and going very well," Calvert says. Has a buy rating. Shares closed Wednesday at 28p. ([email protected]) 0617 GMT [Dow Jones] JPMorgan Cazenove lifts Centrica (CNA.LN) price target to 385p from 365p. This takes account of the recent rally in UK gas prices, the changes to corporation tax announced in Tuesday's budget and the company's May 10 interim statement. The updated target price implies 29% upside from the current share price. JPMorgan expects the company's update on July 28 to be strong due to the cold winter in the UK boosting residential gas demand at the same time as wholesale gas prices remained subdued. Overweight rating. Shares closed Wednesday at 299p. ([email protected]) 0558 GMT [Dow Jones] Jefferies International downgrades Imagination Technologies (IMG.LN) to hold from buy given the recent share price rise. Says "we caution buying significantly above 300p." Still, notes the company's decent FY '10 figures, and raises target price to 325p from 290p. The firm reiterated its outlook and trading sentiment should continue to be positive, says Jefferies. Shares closed Wednesday at 295p. ([email protected]) Contact us in London. +44-20-7842-9288 [email protected] (END) Dow Jones Newswires June 24, 2010 03:23 ET (07:23 GMT)