Top of the Street: Rolls Royce, Bayer, European steelmakers
04/12/2023 13:26
A round-up of notable broker activity this morning from Europe's
top-ranked* analysts:
** J.P.Morgan raises Rolls-Royce RR.L to "overweight" from
"neutral", saying a much higher percentage of the British
engineering company's long-term service agreement advances will
now convert into profit
** UBS cuts Bayer BAYGn.DE to "neutral" from "buy" as it
expects difficulties in the German group's pharmaceutical and
agricultural businesses to offset growth in the consumer
division
** Exane BNP Paribas raises Spanish construction and energy
conglomerate Acciona ANA.MC to "neutral" from "underperform"
expecting improvement in its infrastructure business, and seeing
unit Acciona Energia ANE.MC and 47%-owned Nordex NDXG.DE as
the main drivers for the company's share performance
** Goldman Sachs downgrades wireless network infrastructure
company Infrastrutture Wireless Italiane INWT.MI to "neutral"
from "buy" following share outperformance that leaves limited
scope for the premium to expand further
** Oddo BHF raises Aeroports de Paris ADP.PA to "neutral"
from "underperform" but remains cautious on the airport operator
due to regulatory uncertainties
INITIATIONS AND REINSTATEMENTS
** GS reinstates Rolls-Royce at "buy" seeing improving cash
and earnings momentum driven by mix tailwinds in Civil Aerospace
** Jefferies initiates ArcelorMittal MT.LU , MT.AS at
"buy" saying its shares are best placed among European
steelmakers to benefit from inflecting prices and spreads
** Jefferies starts with "hold" Voestalpine VOES.VI ,
saying recovery in the tool steel and metal forming business is
"later cycle", and SSAB SSABa.ST on valuation basis, though it
deems the latter a potential longer-term winner in EU steel
** Barclays reinstates Glencore GLEN.L at "equal-weight",
saying lower thermal coal prices, near-term capital commitments
and required balance sheet deleveraging leave little excess cash
flow for shareholder returns over the next two years
** Morgan Stanley initiates Swiss laboratory instruments
maker Tecan TECN.S with "equal-weight", saying near-term
earnings risk from volatile life sciences end-market is priced
in
(*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 Paolo Laudani and Elviira Luoma)
((Paolo.laudani@thomsonreuters.com))