Broker tips: Centrica, Royal Dutch Shell, Domino's Pizza

JP Morgan Cazenove lifted Centrica to 'neutral' from 'underweight' and upped the price target to 205p from 180p, noting that the worst case scenario was now off the table after the Queen's Speech left out any mention of an energy price cap.

"The UK general election is shaping to be a tipping point for UK supply markets, with a weakened Tory government opting for further consultation on energy market reform rather than pressing ahead with a market-wide price cap.

"In doing so, the government has effectively taken off the table the ‘worst case’ scenario we had feared."

In the Queen's Speech, the government proposed to "extend the price protection currently in place for some vulnerable customers to more customers on the poorest value tariffs". JPM concluded from this that the likelihood of a market-wide cap has fallen.

Although some relief is warranted, JPM cautioned that there is a caveat in that the spectre of price regulation still hangs over the industry, with Ofgem exploring further options to help the energy market "work better for all consumers".

A "meaner, leaner and fitter" Royal Dutch Shell may emerge as soon as the outfit's second quarter results, with positive implications for its dividend, said analysts at Credit Suisse as they added the shares to their European Focus List.

Credit Suisse had an 'outperform' recommendation and 2,500 target price on the stock.

However, the analysts revised their 'Blue Sky" scenario target price from 2,910p to 3,065.23p on the assumption of further efficiency gains (the target under its Grey Sky scenario was kept at 2,040p).

Greater capital and operating efficiency could see the firm's break-even price of oil drop by about $10 to $40.

According to the analysts, Shell's chief might use the company's next financials, due on 27 July, to comment more positively on the outlook following the take-over of BG Group.

Shares in Domino's Pizza were looking less than tasty on Friday after Berenberg cut its stance on the stock to 'hold' from 'buy' and chopped the price target to 325p from 400p, saying near-term risks were mounting.

The bank pointed out that for a number of years, Domino’s delivered very strong revenue growth in the UK, before momentum slowed at the start of 2017.

"While we initially thought this would bounce back quickly, we increasingly believe that some issues could create continued pressure on near-term performance. Some of these have the potential to become longer-term problems but we still feel that, as long as they are dealt with, Domino’s could successfully build a larger business in the UK over time. However, given the near-term challenges, we downgrade."

Berenberg said that while the company has taken advantage of the shift to online ordering in recent years, there are now new players changing the game and Domino's is proving slow to react.