Seymour Pierce has upgraded the owner of Argos to a “hold” ahead of its trading update on Thursday. The firm has lost 29.5 per cent of its value in a year, and the current share price of 221p is near fair value, it believes. The broker notes that the retailer’s strong balance sheet could be used for acquisitions, or to impress a predator.
Brewin Dolphin rates the social housing maintenance firm a “buy” with an upgraded 12-month target price of 324p. The broker sees resilience in the sector, and sees scope for rating expansion in the next year as confidence in the firm improves. But capital expenditure linked to the public sector will feel some pressure, it warns.
Evolution Securities continues its “sell” rating with a target price of 298p, down 12 per cent. The broker has downgraded its earnings per share forecast by eight per cent this week, and they now stand 28 per cent below consensus estimates on 2011 earnings. Net asset value should be seen as a ceiling for earnings, according to Evo.