Broker tips: Anglo American, Reckitt, Standard Life
Mon 29 Oct 2012
LONDON (SHARECAST) - South African operation disruptions, production curtailments and a Chief Executive Officer (CEO) exit all add to near-term risks for Anglo American, according to Nomura which has slashed its estates for the mining group.
"We have cut our near-term earnings forecasts by ~20% on average and now sit ~7% below consensus on average on the back of lower iron ore price forecasts and lower production. Looking forward, Q4 is likely to yield further production disappointments," Nomura said.
Its price target for Anglo American has been reduced from 2,100p to 2,000p, accordingly. A 'neutral' rating for the stock has been retained.
Galvan Research has labelled consumer goods giant Reckitt Benckiser as a 'buy' after the company surpassed expectations in the third quarter.
"Time and time again the excitement hungry City has downplayed the fundamentals at Reckitt's, only to be surprised when the group goes on to beat expectations. On this basis alone, and backed by the reiteration of FY 2012 guidance, Reckitt shares are rated a 'buy' at Galvan Research, a view also supported on a technical level with a charting breakout towards 3,900p," said Galvan's head of research Andrew Gibson.
Panmure Gordon has reiterated its positive stance on insurance giant Standard Life ahead of the firm's third-quarter trading update on Wednesday.
"Standard Life’s share price has performed well since the better than expected H1 Results. The shares are up 38% YTD [year to date] and we believe that they will continue to rally given the 16% embedded value discount that the shares are trading at (sector 13% discount)."
With the "growing and attractive" dividend yield of 5.1% compared favourably with the 4.9% sector average, the broker has retained its 'buy' rating and 325p target price for the stock.