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Broker tips: ENRC, Hikma, Micro Focus
Thu, 16th Aug 2012 12:10
UBS has cut its target price for mining group Eurasian Natural Resources Corp (ENRC) from 585p to 565p after first-quarter figures came in below expectations.
UBS has reduced its 2012 and 2013 EPS estimates by 4% and 7%, respectively, mainly on the back of a higher tax rate (which moderates from 2014 onwards).
Nevertheless, the broker has maintained its 'buy' recommendation on the stock, highlighting the board's options to best unlock value, including demurring its international assets.
Jefferies has maintained its 'buy' rating and 860p target price for pharmaceuticals group Hikma after the firm's first-half results came in above forecasts, driven by a better-than-expected performance from the Injectables division.
Hikma reiterated its full-year guidance and said that the Injectables performance will be maintained in the second half. Jefferies said: "We expect the market to focus on 'sustained 2H' injectables performance in 2H rather than lower US generics guidance given we estimate this division is only 4% of adjusted earnings before interest and tax.
Micro Focus is a 'core cash-backed value opportunity' in the software and computer services sector, according to Investec which has reiterated its 'buy' ratting and 600p target price on the stock.
The big news on Thursday was that the company would be undergoing a 50p-a-share cash return, equal to $130m, and a share consolidation.
"We have already modelled this level of return in our forecasts, but assumed it would occur mid-way through the year, so the timing could lead to a 1-3% earnings per share (EPS) uplift to our forecasts," Investec said.
BC
UBS has reduced its 2012 and 2013 EPS estimates by 4% and 7%, respectively, mainly on the back of a higher tax rate (which moderates from 2014 onwards).
Nevertheless, the broker has maintained its 'buy' recommendation on the stock, highlighting the board's options to best unlock value, including demurring its international assets.
Jefferies has maintained its 'buy' rating and 860p target price for pharmaceuticals group Hikma after the firm's first-half results came in above forecasts, driven by a better-than-expected performance from the Injectables division.
Hikma reiterated its full-year guidance and said that the Injectables performance will be maintained in the second half. Jefferies said: "We expect the market to focus on 'sustained 2H' injectables performance in 2H rather than lower US generics guidance given we estimate this division is only 4% of adjusted earnings before interest and tax.
Micro Focus is a 'core cash-backed value opportunity' in the software and computer services sector, according to Investec which has reiterated its 'buy' ratting and 600p target price on the stock.
The big news on Thursday was that the company would be undergoing a 50p-a-share cash return, equal to $130m, and a share consolidation.
"We have already modelled this level of return in our forecasts, but assumed it would occur mid-way through the year, so the timing could lead to a 1-3% earnings per share (EPS) uplift to our forecasts," Investec said.
BC
