UK MARKET TALK ROUNDUP: SHARES LOSING

14th Jul 2010 09:37

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] 0837 GMT [Dow Jones] Deutsche Bank cuts Tullow Oil (TLW.LN) price target to 1255p from 1295p. It describes FY '10 as a "pivotal year" as the company transitions to a more balanced development-exploration business. Deutsche says this will build Tullow's core value, but it notes development lacks the transformational catalysts of exploration. It adds that markets may questions the sustainability of Tullow's exploration-led valuation premium. Cairn Energy (CNE.LN), rated buy, remains the brokerage's top exploration and production pick. Reiterates hold recommendation for Tullow. Shares -1.0% at 1139p. ([email protected]) 0805 GMT [Dow Jones] Bank of America Merrill Lynch downgrades ITV (ITV.LN) to underperform from neutral and cuts target to 47p from 56p. Notes operating momentum is expected to stall in 4Q and cites risks of investment-led downgrades and a consumer slowdown. Adds that ITV trades on 11.1x EPS in '12 versus 10x for its peers and the media sector and says this is too expensive, given macro uncertainty and ongoing structural pressures. Shares -3.7% at 53p. ([email protected]) 0804 GMT [Dow Jones] Nomura downgrades Petrofac (PFC.LN) to reduce from neutral. Continues to be positive on Petrofac's long-term fundamentals, but in light of its premium valuation and the fact that 2H catalysts are very well flagged, finds it difficult to recommend investing at current levels. In a sector-relative context, Nomura sees better opportunities elsewhere. Has 1300p price target on the stock. Shares -1% at 1287p. ([email protected]) 0751 GMT [Dow Jones] Execution Noble downgrades Admiral (ADM.LN) to hold from buy. "We expect EPS growth of 19% in 2011 falling to 13% in 2012 and as such with no upgrades likely in the near term we feel the valuation is now full." It reckons that if and when equity markets stabilize and some of the broader macroeconomic concerns recede, Admiral's significant outperformance relative to the sector may reverse. 1384p fair value. Shares -0.8% at 1465p. ([email protected]) 0713 GMT [Dow Jones] UBS downgrades Severn Trent (SVT.LN) to neutral from buy after the stock gives a total return of 24% year-to-date, outperforming both the FTSE 100 and the sector. Sees little fundamental upside for Severn Trent, although highlights that M&A will be a factor for UK regulated utilities. Says for investors looking for some gearing into the UK water M&A theme, there is better value in United Utilities (UU.LN). Outside of this, sees National Grid (NG.LN) as a compelling investment. Maintains Severn Trent price target at 1275p. Shares are -1.1% at 1278p. ([email protected]) Contact us in London. +44-20-7842-9288 [email protected] (END) Dow Jones Newswires July 14, 2010 04:37 ET (08:37 GMT)