Thomas Cook Group PLC (LON:TCG) is firmly out of favour after yesterday’s profit warning.
Goldman Sachs leads the way with a repeat of its sell advice.
The US broker has cut its earnings forecasts for the next three years given ongoing structural pressure in the German market and the slump in bookings to Turkey.
A new price of 72p has been set, which reflects lower cash, lower growth and 1% downside.
Citigroup has chopped its target price even lower to 62p.
Like Goldmans, earnings forecasts have been cut for the next three years with Airlines Germany again a concern alongside higher net debt and pension liabilities.
“We reiterate our ‘sell’ recommendation.“
Imperial Brands (LON:IMT) was one of the four tobacco giants that got very shirty over the introduction on plain packaging on cigarette packets.
Noting the new EU directive comes into force today, Goldman Sachs said the regulation should be positive for Imperial’s competitive positioning and pave the way for improved underlying performance.
“Plain packaging remains a risk, although the prospect of a minimum excise tax in 2017 eases our concerns on widening price gaps.” ‘Buy’ said the broker.
Cheese maker Dairy Crest (LON:DGC)has negotiated the price declines that have occurred across its product range, suggests HSBC.
“Solid underlying branded food sales plus new functional ingredients should drive strong improvement in free cash flow.”
Buy with a 685p target price.
Investors in debt laden Gulf Keystone Petroleum Limited (LON:GKP) may not have to fear the worst, according to broker Mirabaud.
Whilst the Kurdistan-based oil producer has some US$575mln of bonds outstanding, and needs to raise US$71-88mln of new capital, analyst Richard Savage reckons the company can survive.
He doesn’t expect bondholders will spike the London Stock Exchange listed company – as “it may not sit well” with the Kurdistan authorities, which would complicate matters for whoever may pick up the assets next.
In a note, he said: “equity investors should brace themselves for dilution but the chances of being wiped out are minimal.”