BEST OF THE BROKERS

BUNZL
Shore Capital rates the distribution and outsourcing firm a “buy” at 710p. The broker upgraded its forecasts for pre-tax profit for the year by £6m to £279m after interim results this week. The broker was impressed by Bunzl’s return to acquisition-led growth, and believes investors should ignore the firm’s “worthy but dull” image.

SMITH & NEPHEW
BNP Paribas retains a “neutral” rating on the healthcare equipment company, but has raised its valuation by 15 per cent to 745p based on peer group valuation targets. While the market for elective surgery remains sluggish, the broker says shares are undervalued by around 30 per cent based on earnings per share projections.

HARGREAVES LANSDOWN
The fund manager continues to command a premium valuation over the sector, according to Numis, which rates the stock a “hold” with a 375p target price. The broker has increased its earnings per share forecast from 18p to 18.3p and argues the shift to self-invested personal pensions will shore up the firm’s growth opportunities.