Broker tips: Aegon, Standard Life, Aberdeen, Card Factory

(Sharecast News) - JPMorgan reiterated its 'overweight' stance on Aegon on Friday and double-upgraded Standard Life as it said the sale of Aegon UK to Standard Life is highly likely to receive regulatory approval, which would be "very positive for both".

JPM said the deal eliminates its previous concerns about Standard Life's balance sheet, is accretive with the potential to beat consensus, with further upside from SDLF's track-record of exceeding acquisition synergy guidance.

It said Aegon had sold the business for a higher price than the bank expected, may benefit from future synergies as a circa 15% shareholder in Standard Life, and has a clearer sum-of-the-parts, with attractive valuation upside potential.

JPM upgraded Standard Life to 'overweight' from 'underweight' and hiked the price target to 950p from 620p. The bank lifted its price target on Aegon to €9.45 from €8.40.

Citi upgraded Aberdeen to 'buy' from 'neutral/high risk' as it said there was "still lots to play for".

Citi noted the shares have risen by around 10% over the last month, outperforming the majority of traditional asset managers.

"Despite this, we see plenty of upside for investors to play for, with up to circa 20% upside to consensus estimates (with upside, as we have not fully baked in recent positive markets), significant re-rating potential, particularly of the Investments and ii businesses, and attractive optionality," it said.

Citi said that on its revised numbers, Aberdeen shares trade on 12x FY27E headline price-to-earnings or 8.5x excluding surplus capital and listed stakes, which it estimates implies 'only' 12.5x for the Adviser and fast-growing ii businesses, which looks reasonable.

Berenberg downgraded Card Factory to 'hold' from 'buy' as it took a look at UK mid-cap general retail.

The bank, which cut the price target to 80p from 110p, acknowledged the "deep value" offered by the shares and the fact that management has a credible strategy in place to deliver a return to growth and unlock the company's global opportunity.

However, it said it will likely take time for investors to regain confidence. This will require a return to sustained positive earnings momentum, driven by consistent store like-for-like sales growth; a contribution step-up from international and partnerships; and faster organic online growth.

More broadly, Berenberg said it was taking a more cautious view on UK mid-cap retail into the second half amid a deteriorating backdrop.

"Since the start of the recent Middle East conflict, UK macroeconomic indicators have worsened," it said. "GDP forecasts have fallen, inflation risks have heightened, and the market is now pricing in two 25bp interest rate rises to 4.25% over the remainder of 2026 - 100bp higher than was anticipated in early February."

It added that retail sector data has also turned more negative.

"Footfall declines have worsened, retail sales growth has been subdued, and overall household discretionary disposable income has slowed to no growth," Berenberg said. "In their outlook statements, company management teams are increasingly noting the potential impact of the conflict and caveating guidance with reference to the uncertain backdrop."

Against this backdrop, the bank highlighted six top picks: Genus, Beauty Tech Group, Next, JD Sports, Greencore and Hostelworld, all of which are rated 'buy'.