Nomura rates BSkyB neutral with a £10.00 target over the Competition Commission’s bid to encourage more bidders for movie broadcast rights. The CC suggests letting third parties sell directly to Sky’s Anytime customers, and that Sky publish the dates its film contracts end. Nomura sees limited impact in these as in two recent deals Netflix and LoveFilm outbid Sky, a sign that new names can enter the market.
UBS rates the betting group neutral with a 12 month price target of €41.00 (£35.33) as it views the share price as 13 per cent overvalued. UBS valued Paddy’s businesses at €37 per share, below the current share price, which puts its domestic online business at a premium to its peers. With Paddy’s growth rates on track, UBS sees no reason for the stock to be de-rated to a lower valuation.
Goldman Sachs rates Babcock neutral with a 770p target price after its consortium won a £1.5bn, 10-20 year, government contract to decommission the Dounrey nuclear site. GS sees this as a clear positive that demonstrates Babcock’s ability to diversify away from the MoD and deliver complex projects. The contract’s revenue should be smooth while the margin should be higher than in Babcock’s support services division.