UK MARKET TALK ROUNDUP: SHARES GAINING

15th Jun 2010 09:46

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] 0846 GMT [Dow Jones] Tesco's (TSCO.LN) 1Q trading update is in line with expectations, and the UK performance likely marks the low point of the year, says Bernstein. "We expect that recent increases in food commodity costs should drive an acceleration in food inflation throughout the remainder of '10, and as such expect 1Q represents the low-point of grocers' sales performance in the year." Also expects international performance to accelerate through the year. Adds Tesco trades broadly in line with its UK peers despite having superior long-term growth prospects. Rates the stock at outperform, with 500p price target. Shares +0.8% at 395p. ([email protected]) 0823 GMT [Dow Jones] Numis increases its target price on BSkyB (BSY.LN) to 800p from 703p following News Corp.'s (NWS) approach to buy the 61% stake it doesn't own in the UK pay TV group. Numis media analysts Lorna Tilbian, Paul Richards and Dominic Buch expect a "lengthy regulatory process," but don't view regulatory issues as "insurmountable" and expect a deal will be concluded within the 700p-800p (a share) range. "We believe that News Corp is in robust financial health while the BSkyB valuation does not fully reflect its medium-term growth potential. Combined with the current weakness of sterling, we can certainly see the attractions of a bid," they add. BSkyB shares +19% at 717p. News Corp., which owns Dow Jones & Co. the publisher of this newswire, has a 39.1% stake in BSkyB. ([email protected]) 0821 GMT [Dow Jones] Citigroup raises Weir Group (WEIR.LN) price target to 1280p from 1230p following the company's stronger-than-expected trading update. Says 1H '10 guidance is around GBP26M ahead of previous expectations. Also notes the company's announcement of a GBP138M acquisition of Malaysian-based Linatex, which Weir believes will be around 5% EPS accretive from '11. Citi raises its '10 EPS estimate to 89p from 75p, and its '11 EPS estimate to 94.9p from 81.9p. Shares +0.3% at 1069p. ([email protected]) 0803 GMT [Dow Jones] Panmure Gordon upgrades British Sky Broadcasting (BSY.LN) to hold from sell, following a bid from News Corporation (NWS) of 700p per share to acquire the 61% stake of BSkyB shares it does not own. BSkyB rejects the offer, but has suggested an approach at around 800p could be successful/recommended, says Panmure. "As News Corp is a cash-rich corporate, with a 39% material minority stake already, this is the most logical conclusion," says Panmure, raising the target price of the stock to 750p from 375p. News Corp, parent company of Dow Jones Newswires, has a stake of about 39% in BSkyB. Shares in BSkyB +19% at 716p. ([email protected]) Contact us in London. +44-20-7842-9288 [email protected] (END) Dow Jones Newswires June 15, 2010 04:46 ET (08:46 GMT)