Heavyweight broker JP Morgan Cazenove remains moderately bullish on Royal Mail Group PLC (LON:RMG) despite cutting its price target for the parcels delivery outfit. The rating remains “overweight” despite the price target shifting to 545p from 600p, reflecting a weak showing in the final quarter of 2016 – the group’s third quarter – in terms of mail volumes. In Cazenove’s view, the stock stand out versus its peers ahead in a market that is discounting what Caz thinks will be a positive conclusion to the long-running pension negotiations. HBSC also noted " The good news is that the projected dividend yield of 5.3% is getting up there with sector peers Austrian Post (6.1%) and bpost (5.8%). In HSBC’s view Royal Mail has better growth prospects than both.
I agree about the pensions issue but do think the current price reflects the situation and is a buying opportunity. The dividend is my main reason for buying RMG. I still have a childish excitement over letters and parcels though and love red pillar boxes..
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