Broker tips: BSkyB, BHP Billiton, HSBC...
British Sky Broadcasting’s share price took a knock on Thursday after analysts at HBSC said that the recent rally suggests that ‘significant risks’ are being overlooked.
HSBC said that fears about the upcoming auction of Premier League rights are likely to resurface following the stock’s recent rally. The bank kept an ‘underweight’ rating on the broadband and pay-TV group, while the target price for the shares has been cut from 610p to 600p.
Credit Suisse has said that a potential de-merger of non-core operations at Australia- and UK-listed mining giant BHP Billiton “would get our support”.
“Managing a myriad of smaller, less significant assets in the scheme of BHP only distracts senior management from the main game. If all of the non-core assets are spun-out/divested the company can then focus on the key assets and key decisions ahead.”
Investec has downgraded global banking giant HSBC from ‘buy’ to ‘hold’, saying that investors should seek “better value elsewhere” in the sector after the stock’s recent outperformance.
“Curiously, HSBC outperformed the UK bank sector in the first quarter of 2014. Although its valuation metrics may not appear unduly challenging, it still faces multiple headwinds,” said Analyst Ian Gordon.
Tullow Oil shares were making decent gains on Thursday after UBS upgraded the stock from ‘neutral’ to ‘buy’. The bank said that the investment case for the shares has changed and the risk/reward balance is “now skewed to the upside”.
Canaccord Genuity has lowered its target price for financial services and closed life insurer Resolution from 375p to 300p and retained its ‘hold’ recommendation, saying that the group needs a new strategy following the 2014 Budget.
JPMorgan Cazenove has lifted its recommendation for Mitchells & Butlers from ‘neutral’ to ‘overweight’, saying that it is taking a more positive view on the UK pubs and restaurants sector.