BEST OF THE BROKERS
MCBRIDE
Having started the year with conservative margin assumptions for McBride, Investec has upgraded these in light of its strong start to full-year 2010. The broker said that the top line performance is broadly as expected, but that a better mix is driving profits ahead. Investec therefore lifted earnings per share estimates in the region of 15 per cent and raised its target price to 245p, retaining its “buy” recommendation on the stock.
TATE & LYLE
Deutsche Bank said that its forecasts for Tate & Lyle’s first-half results, due on 6 November, reflect the firm’s guidance for “operating profit for the six months to be broadly in line with the comparative period”. Given a recovery in the sugar premium and some of Tate’s cyclical divisions, the broker has made some material forecast changes. But, with limited total shareholder return on its 475p target price, it downgraded the stock to “hold”.
WPP
JP Morgan expects WPP to report third-quarter revenues roughly in line with its peers’ when the company provides a trading update on Friday. The broker expects modest improvement in organic revenues from results in the second quarter and commentary that the margins are beginning to show signs of stability after aggressive cost-cutting earlier this year. It upped the target price to 625p, with a “neutral” rating.
To appear in Best of the Brokers email your research to [email protected]