| CATEGORY: BROKER RECOMMENDATIONS SECTOR: BANKS |
Broker tips: Lloyds TSB, HBOS, Kelda, Cadbury, Corus |
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Tue 25 Apr 2006
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LONDON (SHARECAST) - UK mortgage lender Lloyds TSB has been upgraded to “reduce” from “sell” by Dresdner Kleinwort Wasserstein as the broker cited valuation grounds.
The German broker noted that shares in Lloyds have not only tumbled recently but hopes of a possible buyout from a US suitor have also faded away.
DKW instead said it prefers HBOS, which it advises buying shares in with a 1,075p price target.
A bullish broker note from Morgan Stanley saw Severn Trent and Kelda upgraded from “equal-weight” to “overweight” and from “underweight” to “equal-weight” respectively.
Morgan Stanley added that renewed focus by the management team after the demerger of Biffa could enable management to reinvigorate the business.
Panmure Gordon started coverage on PartyGaming with “buy” advice and a 225p price target. The broker added that the shares are worth 390p based on long-term cashflow.
Elsewhere Cadbury Schweppes moved higher on the back of news that it is taking full control of the Dr Pepper/Seven Up Bottling. Merrill Lynch kept its “buy” advice on the stock.
Williams de Broe upgraded the stock to “buy” from “hold” following the news.
Corus was heading sharply higher following a bullish note from Citigroup, as the broker stuck with its “buy” advice and raised its price target to 100p from 90p and hiked earnings estimates to reflect an increase in its steel price forecasts.
Citigroup also raised its earnings estimate for Corus by 4.3% to 9.2p per share for 2006, while 2007 was lowered by 6.3% to reflect a smaller reduction in the cost base.
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