Top of the Street: Orsted, Reckitt, Orkla, British water firms
11/12/2023 13:26
A round-up of notable broker activity this morning from Europe's
top-ranked* analysts:
** Barclays upgrades Danish wind energy firm Orsted
ORSTED.CO to "equal-weight" from "underweight" saying the
company will benefit from lower long-term yields and rising
tariffs
** Bernstein raises Dettol-maker Reckitt RKT.L to
"outperform" from "market-perform" saying the stock is
"unjustifiably" cheap and doesn't reflect its "best-in-class"
cash conversion and honest accounting
** The same broker downgrades Orkla ORK.OL to
"underperform" from "market-perform" as it is doubtful about
Norwegian food processing company's strategy and sees growth
suffering as the prices drop in 2024
** UBS raises London-listed National Grid NG.L to "buy"
from "neutral" saying the company offers high growth and rising
returns while its current valuation is low
** UBS also raises German utility E.ON EONGn.DE to "buy"
from "neutral" saying the stock is low-risk and trades at a
discount to its peers, even as the company has a strong balance
sheet relative to the peers
INITIATIONS AND REINSTATEMENTS
** UBS initiates coverage of British water firm United
Utilities UU.L with a "neutral" rating saying the stock trades
close to its fair value, but notes the company's high growth
potential in the coming price control
** The brokerage also starts peer Severn Trent SVT.L at
"sell", saying it has the most expensive valuation in the sector
with the current dividend policy already priced in
** It initiates Pennon Group PNN.L at "buy" seeing a sharp
improvement in the water utility firm's EBITDA from 2026 onwards
(*Analyst rankings from Thomson Reuters StarMine. The scale is
from 1-star to 5-star with 5 being the best. Analysts are ranked
on earnings accuracy as well as relative performance of
recommendations over trailing 12-month & 24-month periods.)
(Reporting by Antonis Pothitos and Greta Rosén Fondahn)
((antonis.pothitos@thomsonreuters.com ;
greta.rosenfondahn@thomsonreuters.com))