BEST OF THE BROKERS

CENTRICA
Morgan Stanley rates the utilities company as “overweight” and sets a target price of 360p, saying that developments at British Gas in UK upstream gas and power assets are underappreciated. The broker says Centrica will grow at seven per cent per year, even in an economic slowdown, or 15 per cent if it uses its underlevered balance sheet. MS says the business is well ahead of its peers, and that the gap will widen.

BOOKER GROUP
Evolution Securities rates the food wholesaler as a “buy” with a target price of 80p. Ahead of the group’s second quarter update tomorrow, the broker expects a good performance but tough comparitives and macro headwind that could slow growth. It’s non-tobacco like-for-like forecast of 2.5 per cent compares favourably to peers, and Booker’s attractive growth opportunities mean it remains the sector’s top pick.

MITIE GROUP
Investec rates the outsourcing company as a “buy” with a target price of 262p, after it announced it had been chosen as the preferred partner for a facilities management services contract with Essex County Council. The broker expects the contract to be worth £10-20m per year over the next 10 years, which is not big enough to affect forecasts, but is a good public sector win and evidence of growth potential.