UK MARKET TALK ROUNDUP: SHARES LOSING

28th Jun 2010 11:14

Stocks on the fall in the UK today. Compiled by Dow Jones Newswires Markets Desk, [email protected] Contact us in London. +44-20-7842-9464 [email protected] 1014 GMT [Dow Jones] Nomura downgrades Go-Ahead Group (GOG.LN) to neutral from buy. This reflects the difficult London bus market. Nomura also says UK rail EBITA is not as high as hoped, given stronger passenger revenue growth. Cuts the price target to 1250p from 1665p. "London bus is likely to remain challenging, and although revenue growth in UK rail remains strong, the required rate of revenue growth for '11 is relatively high." Shares -6.0% at 1097p. ([email protected]) 0932 GMT [Dow Jones] Citigroup nudges down Micro Focus International (MCRO.LN) price target to 600p from 650p. Citi tempers its top-of-consensus forecasts, which were based on the brokerage's more bullish stance on growth in the testing business. Cuts '10 EPS forecast to 54.5p from 57.4p, 11 to 60.6p from 71.7p and '12 to 68.9p from 79.5p. But is still bullish for migration projects and strong growth in larger value transactions in the core business. Meanwhile, notes the share price drop after the chief financial officer's resignation. Thinks this is an over-reaction. Suggests investors should buy the dip. Keeps at buy. Shares -3.7% at 420.3p. ([email protected]) 0840 GMT [Dow Jones] Panmure Gordon downgrades Connaught (CNT.LN) to sell from buy and cuts target to 175p from 470p following the company's recent reduced guidance. "In view of the issues which have always come under question, the investment spend, accounting, the nature of contracts and the departure of CEO Mark Davies, we advise investors at present and in view of this recent news to avoid this stock." Panmure cuts its '10 EPS estimate to 20.7p from 28.5p. Shares -37% at 136p. ([email protected]) 0834 GMT [Dow Jones] Bank of America Merrill Lynch lowers Go-Ahead Group (GOG.LN) to underperform from neutral and lowers price objective to 1260p from 1530p. Brokerage also lowers its FY10 EPS estimate to 121.1p from 123.5p and FY11 estimate to 106.9p from 127.9p. Says the majority of the FY11 decline is driven by cost pressures in rail, while the longer-term downgrades stem from more structural issues facing London bus, as budget headwinds increase. "With a lack of near-term positive catalysts, we are lowering our recommendation," it adds. Shares -3% at 1132p. ([email protected]) 0820 GMT [Dow Jones] Liberum cuts Connaught (CNT.LN) target to 200p from 325p after the company cuts EBITA guidance. Says Connaught's cuts to FY '10 EBITA guidance by 23% and FY '11 by 24% relates to the deferral of maintenance on 31 contracts. Meanwhile, notes the purchase of shares by directors. Says this could imply that management was unaware of the problems facing the business, which in turn implies that visibility is worse than previously thought. Has a sell recommendation. Shares -38% to 134p. Connaught is the biggest decliner amongst the FTSE mid-caps, Monday.([email protected]) 0706 GMT [Dow Jones] Standard Chartered (STAN.LN) offers a decent trading update, says Shore Capital, largely consistent with its expectations. Says group underlying income and profits are ahead of the comparable period in 2009, although the 1H performance has been tempered by quieter close to the period for Wholesale Banking. Adds its balance sheet remains strong, with stable loan to deposit levels, disciplined risk weighted asset growth and no direct exposure to sovereign debt in Southern Europe. Keeps a buy rating. Shares -1.2% at 1722p. ([email protected]) Contact us in London. +44-20-7842-9288 [email protected] (END) Dow Jones Newswires June 28, 2010 06:14 ET (10:14 GMT)