BEST OF THE BROKERS

MICHELIN
Citigroup believes the market will take until the end of 2010 to get more comfortable with Michelin’s investment case. The broker, which rates the stock as “overweight”, estimates the €1.2bn rights issue causes around 11 per cent dilution, which implies new cash is utilised at a similar return as the rest of the business today.

PADDY POWER
Credit Suisse initiates coverage of Paddy Power with an “outperform” rating and target price of €30.70. The broker says an operationally leveraged UK retail expansion for Paddy Power and market share growth in online should provide scope for revenue-driven consensus upgrades over the next six to 12 months.

DOMINO’S PIZZA
Following another set of strong results for Domino’s Pizza, Seymour Pierce is upgrading forecasts for the full-year. The broker expects before tax profit for the pizza group to rise from £36.6m to £37m and says that if the current trend continues, Domino’s has the potential to beat this forecast. The broker gives the stock a “buy”.