UK MARKET TALK ROUNDUP: SHARES GAINING

8th Jun 2010 10:56

Stocks on the rise in the UK today. Compiled by Dow Jones Newswires Markets Desk, [email protected] Contact us in London. +44-20-7842-9464 [email protected] 0956 GMT [Dow Jones] Investec Securities raises Reed Elsevier (REL.LN) to buy from hold. "Shares are circa 11% since we initiated, and now provide 21% potential upside from current levels," it says. Brokerage adds that while it is hard to see significant earnings upgrades resulting from the 1H results given the ongoing investment requirements, "we see limited scope for bad news and this in itself should be a positive for the shares." Keeps 570p target price. Shares +0.8% at 475p. ([email protected]) 0951 GMT [Dow Jones] KBC Peel Hunt raises Aggreko (AGK.LN) price target to 1400p from 1200p following the company's better than expected 1H trading update. Says International Power Projects continues to perform well. Also notes the fact management has increased group capex guidance to GBP265M from GBP220M. KBC anticipates raising its '10 EPS estimate by 10% to 67p. Reckons the shares are likely to edge higher in the near term. Keeps at hold. Shares +3% at 1395p. ([email protected]) 0927 GMT [Dow Jones] Aggreko's (AGK.LN) update is positive, with current trading materially better than anticipated, says Panmure Gordon. 2H looks incredibly positive, with a number of new projects to come on stream and rate improvements seen in the last few weeks to further improve activity, says Panmure. Adds: "With longer term energy requirements unlikely to dampen given the background for infrastructure spending patterns and the likelihood for U.S. storm revenue to be a positive given last year's inactivity, we believe Aggreko remains a high quality situation." Keeps at hold with 1212p price target. Shares +3.1% at 1396p. ([email protected]) 0855 GMT [Dow Jones] Goldman Sachs initiates coverage of Mothercare (MTC.LN) at buy with 723p price target. Says it offers investors an attractive combination of UK business resilience and overseas growth at a compelling valuation. Says the 23% sell off year-to-date offers an attractive entry point. Describes the business as well-run, led by a cost-conscious management team, and with significant upside potential from international expansion. Says the 1Q '11 trading update on July 15 will be key to the company's re-rating. Shares are +0.8% at 530p. ([email protected]) 0810 GMT [Dow Jones] Morgan Stanley lifts Travis Perkins (TPK.LN) price target to 1150p from 1020p following its interim management statement. Says trading in the merchant business is better than expected, with stronger than expected like-for-like growth. Now forecasts FY '10 +5% organic growth for merchant, from +2% previously. Elsewhere, says the indicative offer for BSS Group (BTSM.LN) looks attractive both financially and strategically. Notes that Travis stock has been out of favor year-to-date. But on 10.8x PE and 0.63x EV to sales for FY '10, says the shares are not expensive. Keeps at overweight. Shares +0.3% at 760p. ([email protected]) 0725 GMT [Dow Jones] Chloride (CHLD.LN) and ABB (ABB) announce an agreed bid for Chloride at 325p/share in cash (plus a dividend still payable of 3.3p/share), notes Seymour Pierce. Adds this bid from ABB is a surprise, as ABB has no direct interest in these markets but does have extensive skills, products and market share in electrical power and automation. Emerson Electric Co. (EMR) has pursued Chloride in the past, and Seymour Pierce keeps Chloride at hold as potential remains for Emerson to return. Sees a 'top end' Emerson bid price of 373p/share, applying Emerson's 'strategic' valuation methodology, and doesn't see how ABB could justify matching that. Chloride +18% at 340p. ([email protected]) Contact us in London. +44-20-7842-9288 [email protected] (END) Dow Jones Newswires June 08, 2010 05:56 ET (09:56 GMT)