BEST OF THE BROKERS

CHEMRING
Credit Suisse has downgraded the arms and defence group to “neutral” from “outperform” and lowered its target price to 420p from 460p, as well as reducing its 2012 earnings estimates by 15 per cent. The broker sees the firm as being in a “new norm” where growth is much weaker and order timing unpredictable, with 2012 looking particularly difficult.

XSTRATA
Citi has downgraded the mining group to “neutral” and slashed its target price from £13.50 to £12. The broker says the company is trading at a 20 per cent premium to Rio Tinto and a 10 per cent premium to BHP Billiton on a one-year forward price-to-earnings ratio, but does not have a returns profile to support the valuation.

MCBRIDE
Goldman Sachs has upgraded the household goods provider to “buy” from “neutral” with a target price of 136p, saying the company’s current value is unjustified and presents a buying opportunity. However, the broker remains mindful of the longer-term outlook given the company’s vulnerable position in an at-risk supply chain, but expects strong growth from first-half results in February.