UBS sees Lukoil as cheap stock with a number of positive short-medium term catalysts not yet priced in. The broker, which reiterates a “buy” rating for the Russian energy group, says on a relative basis, Lukoil is starting to receive tax breaks and is probably set to acquire the most desired upstream assets at a reasonble price.
Like all telecoms companies, Virgin Media is heavily operationally geared with high gross margin services layered on top of fixed network running costs, according to JP Morgan Cazenove. The broker forecasts 70 per cent of additional revenue added in 2010-15 to drop through to cash flow and gives Virgin Media an “overweight” rating.
InterContinental Hotels has seen asset ownership diminish, while growth is skewed more to Asia, says Credit Suisse. An “outperform” rating is retained by the broker, which has increased the price target for the hotels group to 1343p. The broker expects concerns about the US system to be compensated by Asian profit impact.