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Broker tips: PureTech Health, Petropavlovsk, Relx

Wed, 29th Jul 2020 14:59

(Sharecast News) - Analysts at Liberum raised their target price on biotechnology company PureTech Health from 450.0p to 490.0p on Wednesday, stating the firm had made some "underappreciated" progress.
Liberum said PureTech and its affiliates had made "huge progress" over the last 18 months, pointing to the group's ability to secure two product approvals and launch a successful initial public offering.

The analysts stated that the company, which was now turning its development expertise to its internal pipeline, also holds "significant promise".

However, Liberum said that value creation was not reflected in PureTech's share price but acknowledged that its new sum of the parts share price estimate offered over 80% upside from current levels.

But Liberum did also note that progress at affiliate companies, like Vedant, and in its internal pipeline should close this gap over the next year.

Analysts at Canaccord Genuity stuck to their 'buy' recommendation for shares of Petropavlovsk despite what some market commentary said was an ongoing board battle for control of the Russian gold miner.

Dubbing recent "board-level issues" a "distraction, analyst Sam Catalano described the outfit's fundamentals as "strong".

While the Canadian bank acknowledged that investors were in a position to take profits after a 200% year-to-date gain for the stock, it still believes that "significant fundamental value upside" remains for POG and resolution of the board-level volatility could be "a powerful positive catalyst for the stock".

However, the split recommendations from the board on how best to proceed did add to the short-term uncertainty, Catalano conceded.

But even while keeping his target price for the stock at 40.0p, he estimated that under conservative assumptions there was a "clear pathway to an additional 5-10p per share" to its assessment of net present value.

Analysts at Berenberg lowered their target price on 'hold' rated publisher Relx from 2,080.0p to 1,800.0p on Wednesday, stating they were still "on the fence" about the group.

Following "slightly disappointing results" at the group level, primarily due to larger-than-expected losses in the company's exhibitions division, Berenberg opted to "remain on the sidelines" when it came to Relx.

While the German bank acknowledged that the blue-chip stock was "clearly not as affected by Covid-19 as peer Informa", it highlighted that neither was it "as resilient as Wolters Kluwer".

"Valuation is not yet sufficiently compelling to prompt a change in rating, although we continue to see Relx as a quality stock that has strong appeal in a broad portfolio," said Berenberg.

Berenberg said its price target reduction reflected lower medium-term estimates, which were affected by currency changes, as well as more cautious operating estimates, plus a slightly higher level of net debt.

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