Best of the Brokers for 29 April 2014

To appear in Best of the Brokers, email your research to notes@cityam.com

DIAGEO
Credit Suisse has cut the drinks group from “outperform” to “neutral” with a target reduced from 2,200p to 1,950p. The broker has also lowered its profit forecast for the coming year by eight per cent to reflect weaker growth in the US and emerging markets.

OCADO
Shore Capital has reiterated its “sell” rating on the online grocer, with a 330p target. The broker thinks that Ocado’s gross margins face negative pressure as Tesco invests in lowering prices, forcing Ocado to follow suit unless it drops its price-matching pledge.

WPP
Berenberg advises a “sell” rating, setting the target price at 1,150p. The broker says the advertising company’s performance should be measured by its net sales rather than its organic revenue growth, which is driven up by its programmatic trading business Xaxis.