The stock market under appreciates Next's (LON:NXT) growth opportunities, according to Barclays Capital, which has upgraded the retailer to ‘overweight’.
Barclay’s price target is lifted to 9,000p from 7,400p, which implies around 20% upside to the current price of 7,505p.
“Through an efficient and well invested operational model Next can benefit from a positive UK macro environment while incurring minimum capex, which justifies a sector premium valuation in our view,” analyst Christodoulos Chaviaras said in a note.
“Next currently trades in line with the sector, its lowest level in two years, yet it offers the highest dividend yield in our coverage at a time when high yield investments are scarce.”
Barclays also this morning said property website businesses Rightmove (LON:RMV) and Zoopla (LON:ZPLA) still had further upside, and nudged its price targets higher accordingly.
Both stocks already carry Barclays’ ‘overweight’ rating and their respective target prices were increased to 3,750p from 3,350p (Rightmove) and 295p from 260p (Zoopla).
Elsewhere, Credit Suisse upgrades its view of BHP Billiton (LON:BLT) to ‘neutral’ from ‘underperform’.
Oil services group Petrofac (LON:PFC) was upgraded to ‘overweight’ by JP Morgan Cazenove which increases its price target to 1,031p from 969p.
JPMC also shaved it price target for defence and munitions firm Chemring (LON:CHG) to 200p from 220p.
Jefferies downgraded payments processor Monitise to ‘hold’ from ‘buy’ and took a cleaver to its price target.
The investment bank, which now sets its new bar at 15p rather than 36p, says there are too many short-term uncertainties.
“With new customer wins thin on the ground and recent wins likely to take some time to convert into material end-user metrics, the risks have become too great to maintain a credible positive view on the stock,” analyst Milan Radia said.
Espirito Santo is much happier with FTSE 100 engineer Meggitt (LON:MGGT), where its rating has been upgraded to ‘buy’ from ‘hold’ even though earning’s have been trimmed slightly.
Going forward, the broker expects the defence business will turn positive in 2016, business jets will continue strong and civil jet business will accelerate as A350 production rolls out.
The price target rises to 540p from 520p.
Seeing Machines’ (LON:SEE) statement that closer ties with Caterpillar (CAT) in the off-road market for fatigue monitoring systems is paying off is good news, says finnCap.
“The phased alliance agreement will lead to CAT gradually taking over the DSS off-road business and developing it further through the US giant’s global reseller network.
CAT also adds adds a reliable and recurring service business – CAT Safety Services – to reduce the lumpiness of its hardware sales, added finnCap.
Seeing Machines now receives margin on the hardware and a monthly licence fee for its software.
Eventually, CAT will take over hardware manufacture and SEE will just get a software licence – at virtually all margin. It target price is 12p.
SP Angel has trimmed its price target on Russia- focused nickel explorer Sp Angel to ‘hold’ from ‘buy’ after the recent surge in the share price.
The broker’s target is 21p and the shares are now 28.8p despite drifting lower recently. Amur said it today its drill programme for 2015 at its Kun-Manie prospect had been approved.