Kingfisher Share News (KGF)

Hedge fund manager Man Group is comfortably the highest yielding stock among FTSE 100 constituents, but a rebasing - a City euphemism for a cut - of the dividend could be on the way, according to Morgan Stanley.The shares are currently yielding 11.77% based on historical dividend payments and though Morgan Stanley thinks the company will dip into reserves to hold its divi at 44 cents in fiscal 2010 it may not be so keen to do so again in fiscal 2011.'Given ... below-average performance fees and slower recovery in sales momentum, we see an increasing likelihood that dividends will be rebased and assume a ~45% reduction in DPS [dividend per share] to $0.25 for FY11e [fiscal year 2011 estimate], implying just covered by FY11 earnings,' Morgan Stanley analyst Bruce Hamilton said.Hamilton has chopped his price target for Man from 340p to 260p. Elsewhere in the broking community Numis Securities has downgraded Man from 'buy' to 'add'.DIY retailer Kingfisher was one of the top performing blue-chips on Wednesday morning after bullish comment on the B&Q owner from HSBC.The bank said Kingfisher's self-help strategies will boost returns in the short term while over the longer term the company should be able to make its size pay and improve long term cash flow.'Competitive advantages should yield over the long term structurally higher returns for shareholders, while its underused balance sheet offers potential for international expansion and/or sector consolidation,' HSBC analyst Paul Rossington said.HSBC has upgraded the stock from 'neutral' to 'overweight'. Broker Panmure Gordon was predicting yesterday that results from Hikma would be ahead of market expectations, so the in-line with consensus performance from the generic drugs producer came as a disappointment.The outlook statement also served to sap market enthusiasm for the stock in early trading on Wednesday. 'Outlook was weak in the branded business which represents 55% of revenues. The shortfall could result in modest downgrades albeit compensated somewhat by better performance in injectables and generics,' Panmure Gordon analyst Savvas Neophytou suggests.Management also hinted strongly at possible acquisitions, which Panmure Gordon thinks would present 'an important business and financing risk'.The broker has kept its 'hold' recommendation on the stock and stuck with its 530p price target.In contrast, Charles Stanley has downgraded the stock to 'hold' from 'accumulate'. The stock's premium rating reflects 'vague bid speculation as leading global pharmaceutical businesses eye the fast-growing [MENA] region' but reckons this is already built into the price, as is forecast strong revenue growth.