Broker tips: Marks & Spencer, Hotel Chocolat, Tullow Oil, Enquest
By Iain Gilbert
Date: Friday 08 Oct 2021
(Sharecast News) - Peel Hunt upgraded Marks & Spencer to 'add' from 'hold' on Friday and lifted the price target to 190.0p from 150.0p following the retailer's capital markets day.
Peel said the CMD was "highly entertaining and informative, a complete opposite to the one two years ago, which bored us to tears and showed no new strategic or tactical thinking".
"This was an authoritative, confident showing from M&S, where weaknesses were owned up to and strengths demonstrated."
Peel said value for money in both foot and clothing/home is better than it has been for years, and the Sparks card is starting to add value in CRM terms.
"Availability should improve, which is absolutely fundamental in customers' eyes," Peel said. "There is loads more for M&S to do and the waters for all retailers are choppy given the supply chain issues, but we think it is worth adding on red days."
Analysts at Berenberg raised their target price on food manufacturer Hotel Chocolat Group from 390.0p to 430.0p on Friday, citing "significant retail growth".
Berenberg said Hotel Chocolat had delivered an impressive set of full-year results earlier in the week, driven by continued strength in its digital, subscription and wholesale channels.
The German bank also noted that Hotel Chocolat had reported that UK stores had performed "well" and contributed to growth since re-opening in April, with sales up roughly 22% year-on-year despite almost six months of store closures.
"Given that one of our key concerns is the cannibalisation of sales between channels 'post-pandemic', we are encouraged by this momentum and raise our estimates and price target accordingly," said Berenberg, which reiterated its 'hold' rating on the stock.
Jefferies upgraded Tullow Oil and EnQuest on Friday as it took a look at the oil and gas exploration and production sector.
The bank upped Tullow to 'buy' from 'hold' and lifted its price target for the stock to 70.0p from 50.0p.
"Alongside increased commodity price deck we also allow for improved production expectations from Tullow's Jubilee field," it said, as it highlighted the "material leverage" that Tullow exhibits to higher oil prices.
"In our $70.0/b oil price scenario, Tullow's Total net asset value increases 61% to 93p and 2022 - 2025 free cash flow yield increases to 33%.
"With the renewed focus on Ghana production and this commodity price sensitivity we upgrade to buy with a 70p price target with the catalyst being evidence of production improvement into 2022."
Jefferies also boosted its stance on EnQuest to 'buy' from 'hold' and upped the shares' price target to 30.0p from 24.0p.
"EnQuest is working through some operational challenges at its UK Magnus facility but with completion of the Golden Eagle asset acquisition ahead and significant leverage to oil price we pass through our commodity price changes and go with the 26% increased price target of 30p," it said.
Email this article to a friend
or share it with one of these popular networks:
You are here: news
10 Lower Thames St,
London EC3R 6EN