Credit Suisse rates the oil group “outperform” with a target price of 610p. The broker likes BP for its expected positive news from the Gulf of Mexico assets, and expects progress in the region to help the group push past share price pressure linked to its failed deal with Rosneft. Credit Suisse also thinks the firm’s long-term exploration prospects are good, though its new strategy will take time to implement.
LLOYDS BANKING GROUP
Nomura rates the bank “buy” with a target price of 50p. The broker thinks Lloyds’ core franchise is profitable, with a book value that is likely to grow and help meet increased capital requirements organically. Nomura is confident that growth in the bank’s core assets will offset expenses linked to selling off non-core operations, though it has cut its forecasts to account for higher run-off costs.
F&C ASSET MANAGEMENT
Deutsche Bank has upgraded the firm from “sell” to “hold” with a trimmed target price of 74p, down from 76p previously. Despite F&C’s disappointing results last week, the broker thinks the firm’s shares can recover from recent relative underperformance. It adds that Sherborne has scope to increase its stake from its current 20 per cent now that the close period is over, which could act as a catalyst or support for the share price.