| CATEGORY: BROKER RECOMMENDATIONS SECTOR: TELECOMMUNICATIONS |
Broker tips: Vodafone, Morrison, Wetherspoon, Games Workshop |
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Tue 22 Jan 2008
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LONDON (SHARECAST) - JP Morgan has raised its price target on Vodafone, while raising its price target to 226p from 220p, citing the mobile phone company’s 'strong defensive credentials'.
JPM said it was raising its EPS estimates by 1.4% for 2008, 3.5% for 2009 and 3% for 2010 to reflect recent weakness in sterling.
Vodafone’s “UK business should report a small acceleration in LFL service revenue growth, a very positive result given the consumer backdrop,” the broker said.
JPM added that its currency driven upgrade was diluted by a more conservative view on Spain. However, Vodafone is still cheap compared with the rest of the sector, it added.
Seymour Pierce reacted to Wm Morrison’s Christmas trading statement by maintaining its ‘outperform’ rating on the supermarket.
Morrison said like-for-like sales excluding fuel in the six weeks to January 6 rose 9.5% from the same period a year ago.
Describing Morrison’s trading update as ‘very impressive’, Seymour Pierce said it was looking to upgrade its full year profit forecast for the supermarket group towards £550m from the current £485m.
Altium Securities downgraded JD Wetherspoon to ‘hold’ from ‘buy’ after the pub group reported a drop in like-for-like sales in the 11 weeks to January 13.
Wetherspoon’s like for like sales fell 3.2% in the first 11 weeks of the second quarter as strong food sales growth failed to offset weaker bar sales. Altium said the short-term outlook for Wetherspoon was challenging, even though a normal summer would help the group.
Among smaller companies WH Ireland downgraded Games Workshop Group to ‘underperform’ from ‘market perform’ after the war gaming model specialist swung into the red at the halfway stage.
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