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Broker tips: Easyjet, Royal Mail, Thomas Cook

Tue, 12th May 2015 11:21

Easyjet's share price dropped back down to earth on Tuesday after the budget airline delivered a cautious outlook, with the market consensus stance on the stock as a 'buy' likely to come under pressure."Given that the shares have risen 19% over the last six months alone, as compared to a 6% hike for the wider FTSE100, there may also be an element of profit taking in today's share price nosedive. It remains to be seen whether the current market consensus of the shares as a strong buy will equally be disturbed," said Hargreaves Lansdown Stockbrokers.Credit Suisse said it sees an attractive risk-reward balance at Thomas Cook Group as it upgraded its rating on the travel tour operator from 'neutral' to 'outperform'.The bank pointed out that TCG has underperformed sector rival TUI by around 45% since September last year and now trades at a 30% discount on a price-to-earnings basis. It has lifted its target price for the shares from 159p to 180p, which implies 18% upside potential from current prices.Goldman Sachs has reiterated its 'buy' recommendation on Royal Mail Group's stock after competitor Whistl said it would suspend all end-to-end mail deliveries in the UK.Goldman said the news should result in an "instant increase in volumes" for RMG's downstream network, though the final impact will depend on PostNL's strategic review.

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