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Broker Round-up Part 1: BP, Moneysupermarket.com, EasyJet, Yell Group and Taylor Wimpey

Last updated: 12:26 06 Jun 2012 BST, First published: 16:26 06 Jun 2012 BST

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As interest swirls around the sale of BP’s (LON:BP.) stake in Russian venture TNK-BP, brokers across the board voiced their opinions today.

Citigroup pointed to the possibility of a Chinese buyer, which it predicts would have to be a minority shareholder for a deal to go through.

“We think a Chinese buyer would be motivated by strategic concerns – matching the country's ever-rising demand for oil with exposure to reserves – more than by immediate financial concerns, meaning that dividend pressure could be lessened.”

JP Morgan Cazenove, which values the 50 per cent stake at between US$28 billion and US$32 billion, sees the sale as a positive move for the British company, whose shareholders have “long wanted BP to downsize more aggressively”.

Meanwhile, UBS believes the timing is right for BP to leave Russia, making it an interesting proposition for investors.

Notably, a sale could lead to a £10 billion return of capital to shareholders through a special dividend or share buyback.

Price comparison website Moneysupermarket.com (LON:MONY) could be under threat from Google following the £87 million deal to buy Money Saving Expert, says broker Numis.

Analyst David McCann reckons that the deal is a good one for the company, provided it can keep hold of most of its visitors.

But Google’s new Panda algorithm, which has downgraded price comparison sites to “low quality”, puts the company at risk, since McCann estimates Google traffic will still account for more than half of the company’s earnings following the purchase of Money Saving Expert.

Nevertheless, the analyst has upgraded the stock from ‘sell’ to ‘reduce’ and pushed up his target price by 5 pence to 104 pence given the financial boost from the deal.

Budget airline EasyJet (LON:EZJ) is a no-fly zone for investors, according to JP Morgan Cazenove.

The broker retains its ‘underweight’ stance as better value can be found elsewhere in the sector.

“At the current share price, we see no compelling valuation discount to either recent history or the market,” analyst David Pitura said.

He does however expect the cut price airline to beat consensus for this year as long as operations continue as expected, raising his target price to 554 pence from 465 pence.

Directories company Yell Group (LON:YELL) is doing the right things but the outlook remains uncertain according to Citigroup analysts.

The Reading-headquartered firm’s shares have fallen 74 per cent so far this year and as the group addresses its capital structure, the broker sees scope for “significant volatility”, upgrading the stock to ‘neutral’ from ‘sell’.

However, its lack of guidance regarding the capital structure means the broker is unable to set a target price.

House builder Taylor Wimpey (LON:TW.) has been upgraded to ‘buy’ from ‘hold’ by Liberum Capital.

The broker believes the company is well placed to benefit from NewBuy, a government-backed scheme which offers both first-time buyers and existing home owners the chance to buy a new home by putting down just a 5 per cent deposit.

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