RBS rates the engineer a “buy” with an increased target price of £12.25. The broker believes AMEC’s recent half-year results were stronger than expected, with signs of a strengthening pipeline that should drive growth. RBS raised forecasts for 2011 by three per cent, and its target price by almost 20 per cent, although it warns earnings per share improvement might not emerge until 2012 /13.
Numis rates the insurance group a “buy” with a target price of 420p, following the firm’s interim management statement. The broker is impressed by Catlin’s investment income, with earnings $36m (£22.3m) ahead of its 2010 forecasts, and notes that losses from claims have not changed materially. Numis has increased its pre-tax profit forecast for the year by 21 per cent to $426m.
LLOYDS BANKING GROUP
Bank of America Merrill Lynch rates the bank a “buy” with a target price of 110p. The broker believes the market has over-discounted for Lloyds’ £27bn exposure to Irish loans, and that the imminent arrival of a new management team and UK banking recovery gives further reason to buy. It admits that its forecast of 17 per cent return on net asset value in 2012 might be proved to be too harsh.