LONDON (ShareCast) - JP Morgan has lowered its rating on the real estate giant Hammerson to ‘neutral’ from ‘overweight’ on valuation grounds.

“We believe Hammerson has run up in anticipation of (relative) strong first half results on Thursday,” the broker said.

“However, this looks priced in now and the stock has outperformed 20% over last two months.”

JPM said it likes Hammerson, but prefers its peers British Land and Land Securities.

It said it is hard calling the bottom of the decline in retail estate stocks’ share prices and used a historical example to illustrate this.

“UK property would have been a good investment in January ‘92, but it first went down by 39% until September ‘92, before it bounced by 171% until end ‘93,” it said.

JP Morgan has lifted its price target on train and bus operator National Express to 1,164p from 1,153p and kept its ‘overweight’ rating on the stock.

The broker thinks investors have over-focused on rail risk issues, adding that the company may reap the rewards of airlines reducing flights.

“British Airways has announced domestic capacity reductions, and with car drivers seeing continued fuel ‘pain’ on the London to Leeds/York/Newcastle/Edinburgh routes, National Express might gain market share,” JPM said.

Merrill Lynch has raised its rating on the drug group AstraZeneca to ‘neutral’ from ‘underperform’ and raised its target price on the stock to 2,600p from 1,900p.

While the broker has concerns in the long-term over patent expiries and pipeline risks, it does not think these will offset earnings momentum and other positive factors in the short term.

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