BEST of the BROKERS

CHEMRING
JP Morgan rates the defence firm “overweight” and has trimmed its target price from 512p to 491p after weaker than expected first half results. The broker points out that Chemring needs to make 67 per cent of its earnings in the next half in order to meet targets – though its order book, up 14 per cent to top £1bn, means this could be possible. JP Morgan maintains that the firm is the lowest-rated UK defence firm, and is trading at a material discount to its peers.

GREENE KING
Deutsche Bank rates the pub chain “buy” and has raised its price target from 635p to 665p. Greene King has done more than any other publicly-traded pub firm to improve its business, the broker believes, and is on track to build on its 2010 strategy change. Given the firm’s exposure to the wealthiest regions of the UK, Deutsche forecasts strong retail growth in the mid-teens this year.

TUI TRAVEL
Nomura has started covering the holiday firm with a “neutral” rating and a target price of 168p. While TUI has benefited from problems at rival firm Thomas Cook, the broker is worried that the tour operator model as a whole is outdated, and is struggling to see real growth emerging from a cost-cutting strategy. However, Nomura thinks the firm is faring better than Thomas Cook, which has been given a “reduce” rating and a price target of 6p.