logo-loader

Brokers: Inmarsat flies lower after downgrade from Barclays

Last updated: 12:55 08 Feb 2016 GMT, First published: 10:55 08 Feb 2016 GMT

shutterstock_238055443

Satellite operator Inmarsat (LON:ISAT) was on the wrong end of a note from Barclays today, which downgraded the London-based communications group to 'underweight' from 'equal weight'.

Barclays said in the note that over the last 10  years, the group had posted strong growth and the broker saw more ahead following its investment in many new projects.

But analysts at Barclays added: "However, we also see three negatives: 1) Market expectations seem too optimistic: we are below consensus EBITDA for 16e/17e; 2) Execution risk is higher than before as growth is driven by new technologies and products; 3) Competition is rising. We believe these risks are not reflected in valuation." Shares in ISAT fell 38.5p to 981.5p.

Low oil prices took their toll again on Amec Foster Wheeler (LON:AMFW) after Japanese broker Nomura downgraded the stock.

Nomura reduced its recommendation on the stock to neutral and its price target to 360p from 660p.

The oil services group announced the departure of chief executive Samir Brikho last month after a fall in industry investment caused by the decline in crude prices.

In November, Amec said it expected second half profit margins to fall short of those in the first half and cut ordinary dividends by half, starting with the final 2015 dividend. It said its 2016 ordinary dividend would be about half the payout in 2014. Shares in Amec Foster Wheeler leaked 4.6% to 397.4p.

Shares in security group G4S (LON:G4S) backtracked 12.9p, or 6.2%, to 196.5p after Jefferies International downgrades the security group to underperform with a reduced 170p price target.

G4S is recovering after a number of controversies including its failure to provide enough staff at the 2012 Olympics and its involvement in a problematic UK government prisoner tagging contract.

But Deutsche Bank rolled out the red carpet for floor covering retailer Carpetright ((LON:CPR) by upgrading the chain to a buy.

Shares in Carpetright hit a year-high of 609p in June last year but have since fallen to 374.5p as of Monday.

Last month, it posted higher sales in the four weeks to January 23 but reported some softening of like-for-likes before Christmas, reflecting lower customer numbers, although they recovered in the important January sale period.

Oil major Tullow (LON:TLW) reports 2015 results on Wednesday and Investec today repeated  a 'sell' on the shares, based on an oil price of US$55 a barrel, and saying the firm appears now to be run to service its debt.

"Exploration is a portfolio game and Tullow used to be very good at playing it, chasing multiple plays and making every well compete for capital," said Brian Gallagher.

This approach is the right one and the market rewarded the E&P with a premium for delivering it. We accept that things change and falling crude prices and rising debt has meant that Tullow has (rightly) had to shift its focus. That said, in our view, it now risks being run more to service debt than grow value for equity holders."

To small caps, and Sound Energy (LON:SOU) today said has taken an option over 55% of the permit neighbouring its licence at Tendrara in Morocco, where it is preparing to drill its first well.

House broker Cantor Fitzgerald repeated a 'buy' recommendation and a target price of 31p (current price: 18.5p).

It has a total net asset value (NAV) for the group of  30.9p per share, comprised of 16.7p per share of core NAV and 14.2p per share of risked NAV

Chesnara reports strong 2023 results with improved cash generation and...

Chesnara PLC (LSE:CSN) chief executive Steve Murray discusses the company's full-year results for 2023 with Proactive's Stephen Gunnion, describing them as strong and particularly highlighting £53 million in commercial cash generation and a dividend coverage of around 150%. The company has...

1 hour, 59 minutes ago