BEST OF THE BROKERS

XCHANGING
Panmure Gordon has upgraded the outsourcing company from “sell” to “hold” with a target price of 70p, seeing long-term value in the business, whose shares have lost more than 30 per cent in the last three months. The broker says good progress has been made this year since the appointment of Ken Lever as chief executive, which should result in cleaner, more visible cash generative earnings.

DIXONS RETAIL
Nomura rates the electronics retailer as “neutral” with a target price of 16p, and says the challenging first quarter, when it saw UK like-for-like (LFL) sales fall 10 per cent, has been followed by an uncertain trading environment due to squeezed consumer spending. Despite a forecast for a 7.3 per cent drop in first half LFL sales, the broker expects stable losses before interest and tax of £12.2m.

WM MORRISON
JP Morgan rates the supermarket group as “underweight” with a target price of 302p ahead of its third quarter trading update on 10 November. The broker says WM Morrison should maintain its position at the top of the leader board among food retailers on like-for-like sales, but says the gap is flattered by its limited non-food exposure. JP Morgan sees like-for-like sales growth of 2.3 per cent excluding food and VAT, and expects space growth of 2.4 per cent.