Best of the Brokers


Morgan Stanley has upgraded Credit Suisse from “equal-weight” to “overweight” and upped its target price from SwFr25.50 to SwFr30 on expectation of gritty costs cuts from the Swiss bank. This could lead to a return on tangible equity of around 14 per cent, even on flat 2012 earnings, limiting downside.

RBC Capital Markets has moved the energy group from “neutral” to “outperform” with a target price of 1360p, arguing the stock is now cheap and has positive catalysts. The broker predicts exceptional earnings growth of nearly 10 per cent in 2014 and 20 per cent in 2015, despite cautious assumptions.

Nomura has upgraded its rating for the oil and gas group by two notches, to “buy” from “reduce”, with a target price of 750p, saying that exploration and appraisal drilling this year could be a company maker. The broker says the drilling schedule favours the second quarter, but sees potential short-term catalysts as well.