BEST OF THE BROKERS

KESA
Arden Partners rates the electrical goods retailer as neutral after a “dismal” first quarter trading update and cut the target price to 90p. It said it had little confidence in either the group’s earnings visibility, because of uncertainty about the future of Comet and Eurozone worries, or in the management team. Arden cut its profit before tax forecast from £80m to £55m for the current year.

H&M
Morgan Stanley downgraded clothes retailer H&M to equal-weight on concerns its superior record against its peers may be over and cut the target price to SKr 185 (£17.71). It said, however, that it did not expect the high street firm’s earnings to “collapse” over the next 12 to 18 months. The broker said H&M is likely to remain a growth company in the near-term, yet one currently offering a 5.2 per cent dividend yield.

REED ELSEVIER
Panmure Gordon rates the publishing group a “buy” with a 650p target price but asked if it is “time to break up?” It said media reports of shareholder dissatisfaction with the management are unsurprising . Panmure also criticised the performance of its shares as “uninspiring”, stating they were at the same price as 11 years ago in absolute terms, despite a doubling in profits. Each of its main business units may have different dynamics, it added.