--UPDATE, ADDS SMALL CAPS--
Investec, invoking maritime imagery, says Antofagasta (LON:ANTO) is heading into shallow waters and needs to change course.
The City broker rates the copper miner as a ‘sell’ and, in a note, raises serious questions about the business and its strategy.
“With shrinking margins, a weakening balance sheet, almost negligible dividends (if maintained) this year and a capex profile that may not be sustainable, we believe Antofagasta is set to further lose its (relative) safe haven appeal,” said Marc Elliot, Investec analyst.
“Several years of drawing down the balance sheet with enhanced dividends, and what could be viewed as questionable capital investment, leave the company on a much weaker footing to manage the commodity downturn.”
With a 305p price target Investec sees nearly 25% downside to the current price of around 401p.
Shares in European licensed bottler Coca-Cola HBC (LON:CCH) fell about 5% as Barclays Capital downgraded it to ‘underweight’ and dropped its target price to 1,325p (Wednesday’s closing price: 1,400p).
Meanwhile, Barclays increased its target for RSA Insurance Group (LON:RSA) to 434p from 425p (current price: 402p), and repeated an ‘equal weight’ rating.
JP Morgan Cazenove downgraded its view of Paragon Group (LON:PAG) to ‘neutral’ from ‘overweight’.
Emily Ashford, analyst at Cantor, struck a positive tone whilst discussing Sound Energy’s update on the Badile project’s permitting process.
Sound told investors on Wednesday that the Italian authorities had requested additional technical information, but there hadn’t been any objections to the proposed exploration project.
“We do not believe that this represents any form of significant road block to the exploration of Badile and we take comfort in the lack of any objections being raised at the meeting,” Ashford said as she repeated a ‘buy’ recommendation and a 31p per share target.
Northland Capital highlighted a ‘positive update’ from Thor Mining (LON:THR), with analyst Ryan Long saying new funds from the sale of the Spring Hill Gold project are expected this month, which would strengthen the company’s financial position.
Northland’s David Johnson, meanwhile, looked at ticketing and theme park service provider accesso (LON:ACSO) which this morning said 2015 was comfortably in line with expectations.
The analyst described it as a “solid trading update” and highlighted: “Investment in the industry remains good and accesso is well positioned to benefit – reflected in the 12 month share price performance (+52%) and rating (48x FY15 EPS and 36x FY16).”
Amur Minerals (LON:AMC) is substantially accelerating its exploration effort on the Kun Manie, broker SP Angel highlighted in a note.
SP Angel also told investors that Shanta Gold’s €4.6mln financing for underground equipment was “a good move” for the ongoing development of the company’s New Luika gold mine.
Meanwhile, it added that Xtract Resources (LON:XTR) has achieved significant improvements at the Chepica mine.