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- Deutsche Bank reiterates ‘hold’ recommendation for Hargreaves Lansdown
- Barclays downgrades International Distributions Services to ‘equal weight’
- Shore Capital reiterates ‘buy’ rating for Astra Zeneca
- Morgan Stanley upgrades Antofagasta to ‘equal-weight’
- Jefferies upgrades Dechra Pharmaceuticals to ‘buy’
Deutsche Bank has reiterated its ‘hold’ recommendation for Hargreaves Lansdown (LON: HL), with a target price of 940p. Berenberg also has a ‘hold’ recommendation (925p). HL issued two press releases on Monday, a 1Q23 (to end of September) trading statement and the announcement of CEO Chris Hill’s retirement. Neither will reassure investors, Deutsche analysts believe. Uncertainty over who will take over, the ongoing weakness in flows and the pending lawsuit linked to the Woodford fund collapse in 2019, which could potentially impact the dividend if it succeeds, could all weigh on share value. Credit Suisse (900p) and Berenberg (925p) also cut their HL target prices, reiterating ‘neutral’ ratings. At close of trading yesterday, the stock was priced at 799p, a return of -39.9% YTD and -44.7% over 12 months.
Barclays has downgraded International Distributions Services (LON: IDS), formerly Royal Mail, to ‘equal weight’ (overweight), slashing the target price more than 21% to 250p (320p), while Deutsche Bank has dropped the target price to 120p (144p), with a recommendation to ‘sell’. As the Deutsche analysts said, “the issues are not just short-term”, having noted already on 30 September that they were expecting IDS to issue a profit warning ahead of H1 results due on 17 November. At close of trading yesterday, the stock was priced at 196.6p, a return of -60.7% YTD and -52.9% over 12 months.
Shore Capital has reiterated its ‘buy’ rating for Astra Zeneca (LON: AZN), with a target price of 12,300p, describing the drugs giant as “a strong performer [with] a superior industry-leading top-line and earnings growth profile [that] warrants a significant premium rating versus the US and European peer group”. The broker is expecting a strong financial performance when AstraZeneca reports 3Q figures early next month, with revenues for the three months to end September set to be up 11%, and earnings per share up 41%. The broker said AZ should benefit from a return to pre-Covid levels of cancer diagnostics, boosting sales of blockbusters Tagrisso, Imfinzi and Lynparza. Of the 26 banks covering the stock, 21 are positive on the prospects for the stock. At close of trading yesterday, the stock was priced at 9,844p, a return of 14.6% YTD and 14.3% over 12 months.
Morgan Stanley has upgraded Chilean miner Antofagasta (LON: ANTO) to ‘equal-weight’ (underweight), with a target price of 1,220p. The company has faced a number of problems over the past year that have not helped the share price, including union strike threats at its flagship Los Pelambres copper mine, drought conditions, desalination plant construction delays and an expectation that total output will come in at the lower end of its previous forecast. However, increased demand for non-Russian copper has pushed up the copper premium for European buyers by 83% to $234 a tonne for 2023. The premium, set by Chile’s state-owned Codelco, the world’s biggest copper miner, serves as a benchmark for global contracts. At close of trading yesterday, the stock was priced at 1,108.5p, a return of -15.8% YTD and -23.3% over 12 months.
Jefferies has upgraded Dechra Pharmaceuticals (LON: DPH) to ‘buy’ (hold) and raised the target price to 3,112p (2,880p), indicating more than 12% of upside potential on the stock, based on yesterday’s closing price. Berenberg Bank raised its target price of 2,850p. The veterinary pharmaceutical group reported “strong organic growth” across the board for the year to 30 June 2022, including an almost 14% jump in revenue to £682m, a $400m spend on acquisitions and a new subsidiary in South Korea. At close of trading yesterday, the stock was priced at 2,714p, a return of -48.7% YTD and -44.1% over 12 months.
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