Date: Tuesday 17 Jan 2012
LONDON (ShareCast) - Nomura has maintained its buy stance and 1,530p target price on luxury brand Burberry, despite the negative market reaction on Tuesday, saying that the firm has reported a strong third quarter and brand momentum remains intact.
The broker highlights the double-digit mainline comparable store sales growth in Asia and Europe with the Americas up high single digits.
Nomura remains confident: "Burberry is well positioned to accelerate investment and space growth, while defending comp store sales through product development, flagship market investment and innovative marketing."
While Dixons Retail has reported a "solid performance…in what remains a testing market environment", Investec has maintained its hold rating on the stock, highlighting a lack of positive catalysts.
"We are confident that it will be able to make its bond repayment in November, where the market continues to have concerns, but with its consumer markets set to remain weak, we see no short-term catalyst to be more positive at this stage."
A 10p target price is maintained.
Panmure Gordon has upgraded house builder Redrow from hold to buy, saying that the company's 'day in the sun' may not be far away.
"This is a true recovery story in our opinion, as the new management team inherited a situation which warranted a little more work than simply switching written-down land into new high margin land," Panmure said.
While the broker used to believe that Redrow was around 12-18 months behind its peers in its recovery, it now thinks that the company "will soon start to catch up".
The target price is lifted from 129p to 130p, from which the broker sees a 16% upside. "Based on our tariff we upgrade our recommendation on Redrow to buy".