Date: Tuesday 29 May 2012
Credit Suisse has maintained its long-term neutral rating for FTSE 100 speciality chemicals group Johnson Matthey but has given the stock a short-term buy trading call, recommending investors to build positions ahead of the full-year results on June 7th.
"Trading calls are short-term trading opportunities based on market events and catalysts, while the stock rating [neutral] reflects an investment recommendation based on expected total return over a 12-month period relative to the relevant coverage universe," the broker highlighted in a research note on Tuesday.
The broker says that it prefers Belgian materials technology group Umicore in the long run but sees around a 12% potential upside to Johnson Matthey.
It says that results for the fiscal year ended March 31st are already largely known, and with a third-quarter statement in February and a Platinum Day held in May, "we see few surprises in these numbers". The broker expects strong growth to be driven by a recovery in autos volumes in Asia and the US.
"We also think 2013/2014 will be strong years for the company driven by a legislation change in European HDD, ongoing engine changes to reduce carbon emissions and by the introduction of non-road legislation. We see limited risk of an Asian slowdown in autos production."
In an earlier research report on Tuesday, the broker raised its target price on the stock from 2,350p to 2,400p.
Shares were trading 1.98% higher at 2,212p by 09:50.
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