Only registred members can create thier own customized alerts.
Broker Roundup: Home Retail, Lonmin, Aminex, Northern Petroleum, Camco, Metminco, Avia Health Infomatics
Yesterday’s trading statement from Home Retail Group (LON:HOME) was frowned upon by market analysts, leading to a series of downgrades in profit forecasts and target prices.
In its first quarter update, Home Retail said that total sales at Argos dropped 8.1 percent to £817 million. On a like-for-like basis sales were down 9.6 percent.
Citi reduced its estimate for Home Retail’s pre-tax profits for the year to February 2012 by 15 percent to £170 million and cut its target price (TP) for the stock from 210 pence to 180 pence.
Nomura made a similar move, slashing its pre-tax profit projections for 2012 from £203 million to £164.4 million, citing product positioning and pricing, and exposure to lower consumer demographic customers as its main concerns. Analyst Christopher Walker cut his price target from 180 pence to 160 pence.
JP Morgan Cazenove was yet more pessimistic, reducing its 12 month target price from 165 pence to 100 pence after cutting its 2012 pre-tax profit projection in half, from £216 million to £113 million.
UBS has started coverage of South Africa focused platinum producer Lonmin (LON:LMI, JNB:LON), rating it a sell, citing that the firm is signifcantly exposed to major cost pressures. In a note, analyst Ben Davis at the research arm of UBS, gave the stock a £15 price target (current share price £15.24).
"Although the group offers premium leverage to the platinum price and good medium-term growth, given the current cost environment the risk/reward is not attractive at current levels, in our view."
Shore Capital called yesterday’s presentation by Aminex (LON:AEX) very encouraging as it remains on track and fully funded to achieve its objectives during a very exciting period of drilling. “Aminex reports that it remains fully funded to achieve its objectives and, to our minds, yesterday’s presentation was very encouraging,” said analyst Craig Howie.
The broker is now looking forward to the spudding of the Nyuni-2 well in Tanzania, which is set for early next week, giving the company a risked net asset value (NAV) of 20 pence per share, compared to the stock's current market value of 7.88 pence.
Shares in oil and gas group Northern Petroleum(LON:NOP) suffered badly late last month after it cut reserve estimates for its Dutch assets but broker Edison believes the sell-off has been overdone and the shares are now undervalued. Despite the cut in estimates Edison notes that production from Northern’s Netherlands asset base has actually increased significantly in the last year.
It adds that based on these assets alone, its core NAV of 126p “continues to support value well above Northern’s current share price”.
Singer Capital Markets said it still sees significant potential upside to its “conservative” valuation of 32 pence per share for green energy group Camco International (LON:CAO) after data from the United Nations showed progress with the firm’s projects at the start of June.
The house broker says that its valuation includes nothing for the value of contracted post-2012 carbon credit revenue, the US AgPower business nor the SE Asia joint venture above the cash held by that joint venture.
Metminco's (LON:MNC, ASX:MNC) share price fall was overdone according to Singer Capital’s Charlie Long. In a note to clients he said that Peru’s election of left-wing Ollanta Humala as president has unreasonably spooked investors. According to Long the main fear was Humala's proposal for a windfall tax on mining profits, but he believes that any new tax regime will be "less onerous" than is feared.
Broker Panmure Gordon & Co described healthcare systems group Avia Health Informatics (LON:AVIA)'s acquisition of IP rights as a "good strategic move". The broker recommends a "buy" for the stock targeting a price of 45 pence (current price 45 pence).
The firm revealed today that it had acquired the intellectual property rights to sell and manage the future development of Pathfinder - an online patient referral and clinical communication system.
