BEST OF THE BROKERS
BARRATT DEVELOPMENTS
Investec has initiated coverage of the UK housing market with a generally positive stance, seeing solid fundamentals supporting the sector. It rates housebuilder Barratt Developments as a “buy” with a target price of 180p. Though the broker expects Barratt to remain the most volatile of the group it also offers the greatest upside, with its position as the number two player in the London market seen as a very attractive attribute.
AMLIN
Collins Stewart has cut its rating on the non-life insurance group from “buy” to “hold” following more peer disclosures about the cost of last year’s Thai floods. The broker ups its loss estimate for Amlin from $50m to $100m, and lowers 2012 and 2013 earnings by two per cent to account for the higher cost of the Tramline Re protection, which was signed at the end of last year and will cover catastrophe losses from 2012 to 2014.
AFREN
UBS rates the oil & gas company as a “buy” and ups its target price to 140p, based on an assesment of Kurdistan, which makes up 38 per cent of the company’s net asset value. The broker is cautiously positive on Kurdistan, and says corporates are willing to take on political risk where markets are not. UBS sees a potential 25 per cent upside in the country for political de-risking, and a further 80 per cent for exploration de-risking.