Lloyds Share News (LLOY)

Next has revealed a strong set of results with inflation views moderating in the near-term, but Peel Hunt keeps its cautious stance on the retailer as its outlook suggest flat profits in the current year.Pre-tax profit for the 12 months ended January 2011 was up 9% at £551m, slightly above the broker's forecasts of £550.3m and in keeping with the market range. "We view this as a strong outcome for the year, backed by continuing strong levels of cash flow and the buyback," said analyst John Stevenson.However, Next's sales and profit growth expectations for the year ahead point to pre-tax profit being -5% to +5%, and Peel Hunt expects to downgrade its profit estimates by 4%. "Trading on a 2012 price-to-earnings multiple of 8.4, the shares already factor such views in, although Next's dose of realism may weigh on the shares and sector today," said Stevenson.The broker keeps a 'hold' and target price of 2,300p.Budget airline easyJet has been upgraded to a 'hold', from 'reduce', by Charles Stanley Securities following recent share price weakness, but the broker cuts its earnings forecasts in response to oil prices and risks on bottom-line growth.The broker trims its estimates after the recent surge in oil prices and the inevitable impact they have on airlines. It also notes that easyJet's average pre-tax profit per seat is about £3.40, below the group's target of £5 for the ninth consecutive year. "Below that target level, the chances of an adequate return on capital are small," said analyst Douglas McNeill.Charles Stanley reckons that the airline earns over £120m a year from card booking fees, just below the £130m it has averaged over the past five years. However, the Office of Fair Trading will shortly be looking into the use of card booking fees and may decide to prohibit them, perhaps as early as this summer."If outlawed, card fees can always be recouped via the basic fare, but there's no guarantee that they would be recouped in full. We estimate that every £1m not recouped would reduce equity value by about 2p a share," said McNeill.The target price is cut by 10p to reflect this, from 330p, to 320p.Lloyds has underperformed the European banking sector by 8% in the year-to-date, but Evolution Securities says that the bank remains its "top conviction buy" because - beyond short-term risks - the rewards for investors are striking.However, Evolution notes that the short-term outlook is plagued with uncertainties: "The next few months will see a large kitchen-sinking exercise [primarily due to additional Irish impairments, and potential payment protection insurance contingencies], the recommendations of the ICB, and the sale of the 600 branches. Certainly a hectic schedule which, together with other key issues such as the impact from higher UK rates, has scared investors," the broker said.Nevertheless, the medium term remains very bright with the group having a very clear roadmap towards a 20% group return on equity."Lloyds is the only bank in our coverage where we think investors might have a realistic chance of doubling their money, on an 18-24 month view."The new target price of 106p has a 77% upside, according to the broker.