WH IRELAND suggests the recent weakness in fertiliser group Sirius Mineral (LON:SXX) is an opportunity.
The company is currently optimising a Definitive Feasibility Study (DFS) for development of its Polyhalite project in North Yorkshire.
The broker now expects delivery of the DFS at the end of March.
WHI adds the permit for the port is with the planning inspectorate, with the secretary of State for Transport expected to make a decision no later than summer 2016.
Funding alternatives are being considered for Phase I of the project that includes site preparation, shaft sinking and construction of the Mineral Transport System.
Additional offtake agreements are being discussed with existing and potential new customers.
The price has dipped from 19p since December, but WHI says nothing has changed other than the general malaise of the mining market.
Estimates will be reviewed when the DFS appears, but current market price presents an opportunity adds the broker.
Some respite for Rolls-Royce (LON:RR.) among City folk as the scribes at JP Morgan upgraded their rating on yhe aeroengine maker.
True, it’s only to a ‘neutral’ or hold but the broker expects the newsflow over the next six months to be positive and the price target gets a healthy kick up to 690p from 395p
Rolls may only be able to deliver depressed profit and very little free cashflow for several years, but no more profit warnings are likely at least in the short-term.
This may change if industry trends deteriorate, but this looks much less likely in the next six months said JPM.
Glencore (LON:GLEN) is another troubled corporate soul getting a bit of love this morning as Jefferies kept its ‘buy’ rating and 125p target.
Glencore signed a new Revolving Credit Facility (RCF) yesterday and the US broker says the deep discount to NPV highlights how the market misunderstands the mechanics of the Glencore balance sheet.
Citigrtoup . We think it is a positive step and shows the commitment of the banks to Glencore and also removes some nearterm liquidity concerns. Our NPV declines to £2.70 from £2.90; we lower our TP to £1.40 from £1.60. Buy
Another company seeking redemption is Sports Direct (LON:SPD), but Jefferies remains a buyer despite what it says is a widening gulf between owner Mike Ashley's long-term vision and growing governance concerns in the City.
“We believe the shares currently price in an over-pessimistic outlook, and Mr Ashley should consider taking SPD private given the group's free cashflow generation and underleveraged balane sheet.”
Even so, the price target is cut 550p but the buy rating remains.
Jefferies has also kept its ‘buy’ stance on Hikma Pharmaceuticals (LON:HIK) despite trimming its target to 2,355p from 2,555p following publication of the circular for the Roxanne acquisition.
News that Allergy Therapeutics (LON:AGY) has completed enrolment of patients for its Phase II grass pollen allergy trial underlines the momentum building at the vaccine group says Panmure Gordon.
This represents a derisked opportunity, adds the broker, as it builds on the previous positive data for Allergy’s MATAMPL studies and also on the commercial success of Pollinex Quattro in Europe.