Jefferies has dropped BT to ‘hold’ from ‘buy’ and has cut the price target for the stock to 475p from 515p.
Analyst Jerry Dellis highlighted that the previously positive view on BT (date back as far as 2010) was founded on a benign regulatory environment and the group’s efforts to cut costs, but, neither factor remain as reliable support for the group’s valuation.
Dellis explained that Ofcom now demands tougher service standards, the fibre broadband faces new complications, and the Openreach unit faces ‘stiff headwind’. BT’s dividend could end up squeezed, he added.
And, elsewhere, Vodafone was upgraded by Bank of America Merrill Lynch to ‘buy’ from ‘neutral’.
Societe Generale cut investment management group Ashmore Plc (LON:ASHM) to ‘hold’ from ‘buy’.
Focussing on the small cap market, City broker Numis Securities began its coverage of Horizon Discovery Plc (LON:HZD) with a ‘buy’ recommendation and a 252p price target that implies some 50% to the current price of 171p.
Numis analyst Paul Cuddon, in a note, said he expected the expert-gene editor’s to double sales by 2018 and his write up focussed on the group’s “key strategic position in a fast-growing pharmaceutical market”.