ASSOCIATED BRITISH FOODS
Credit Suisse rates the retail group “overweight” with a target price of £10.60. The broker expects underlying group earnings to reach £353m, a rise of 6.6 per cent on last year, when ABF reports half-year results next Wednesday. It thinks like-for-like sales at Primark will be down three per cent, with the UK flat and continental Europe delivering double-digit growth, with margins to be down 60 basis points.
Evolution Securities rates the miner “sell” with a target price of £12. The broker thinks Antofagasta has finished expanding in the near term and that the copper price is set to weaken, further damaging its share price. Evolution is also sceptical about a longer-term shortage of copper supplies, pointing to several large mines that are expanding. It believes peers such as Kazakhmys look cheaper in the current market.
LLOYDS BANKING GROUP
The bank is Nomura’s top pick in the UK financial sector, with a “buy” rating and a target price of 80p. The broker is impressed by Lloyds’ gearing towards traditional banking and expects a restructuring to deliver surplus capital of at least 20p per share within three years. Nomura thinks that even if Lloyds is forced into selling alot more retail branches, the assets will command a good price.