Evolution has maintained its “buy” recommendation on BP, after the oil giant settled its dispute with contractor Cameron over the Macondo accident – although its target price of 510p is at “the lower end” of a valuation range that scales to 771p/sh. Evolution also notes that BP is talking to Ophir Energy about farming into its Tanzanian acreage. However, notes the broker, it “would almost make more sense” for BP to buy Ophir outright.
TATE & LYLE
Sweetener pricing negotiations for 2012 have been completed and seem to have “concluded satisfactorily for the corn processors”, says Investec. So while Tate’s status as the second best-performing stock in the FTSE creates grounds for “some mean revisionary caution” going into 2012, the broker’s sell case is “short of catalysts for the moment”. “We remain sellers on valuation grounds,” concludes Investec. “But our conviction reduces.”
Numis moved Mike Ashley’s Sports Direct from a “hold” to a “buy” because of its success in a “tough consumer environment”. It applauded the retailer for delivering first-half sales growth last week, despite the effect of the World Cup the previous year. Online sales also soared 85 per cent and the broker liked plans to build a 1m sq ft warehouse, describing the firm as a “a well-managed business taking market share and generating cash.”