Friday, 15:45 GMT
Numis repeated an “add” recommendation: “Sector tailwinds remain supportive with a lack of supply across Segro’s markets feeding through to positive rental growth and we expect this to be sustained for at least the next 18-24 months. Segro is well positioned to continue exploiting the market opportunity and we remain positive on the shares.”
Vivendi numbers also disappointed, with the media conglomerate’s fourth-quarter ebita even weaker than had been indicated by a January profit warning. Analysts highlighted poor figures from its recently acquired Havas advertising agency and a lack of clear 2018 guidance.
Barclays cut its target on Vivendi to €22.50. “Management is stating it should fix the issues but Vivendi’s recent large acquisition is not off to a great start,” the broker said. “While we are constructive on music (albeit less than the bulls especially on margins), we think other assets distract from the story, namely Canal+, Havas and Mediaset. This is why we are ‘equal weight.’”
Aim-listed Plant Impact has soared after Croda agreed to buy the crop care company for £10m, an 80 per cent premium to Thursday’s closing valuation. The purchase price is unlikely to jeopardise a special dividend from Croda, likely to be around 100p a share, when the group delivers full-year results on February 27, according to Brenstein analysts.
Citigroup said: “The release of soft fourth-quarter results this morning is an interesting (or perhaps forewarned) follow-up to last night’s investor presentation whose dual purpose seemed to be to try to install confidence that management can run and grow a food company in the absence of mergers and acquisitions, and that Kraft is still very interested in undertaking another large deal. Net-net, today’s results didn’t exactly boost confidence in Kraft’s non-M&A case.”
● Exane BNP Paribas cuts Aggreko to “underperform” with a 600p target. A valuation of 12-times earnings looks too high given the generator-hire specialist is on track for a sixth straight year of declining profit, Exane said.
● RBC downgrades Sky to “sector perform”. Based on history, Fox is likely to sweeten its £10.75-per-share takeover offer by just 7 per cent to £11.50 so, with a 13.06p interim dividend due March 23, that leaves the stock trading close to fair value, RBC said.
● HSBC upgrades Restaurant Group as part of a review of picking out opportunities in the recent leisure sector sell-off.
“[O]ur key buy ideas in the sector are Merlin (oversold on London weakness), Thomas Cook (growth potential in a strong latent demand environment), Autogrill (value play on growing travel concession trends) and Carnival (earnings momentum from demand and company cost initiatives as well as cash return). We see further downside in Sodexo (weak strategy and execution) and upgrade Restaurant Group to hold (execution risks appear priced in).”
● In brief: SocGen restarts coverage of London Stock Exchange with “buy” — Deutsche Bank starts coverage of Evraz with “buy” — Delivery Hero initiated as “overweight” at Barclays — Clariant cut to “underperform” at Credit Suisse.
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