On the Move: Deutsche Bank, Reed Elsevier, Novartis
UK
TATE & LYLE was up 0.22 to 5.94… Goldman Sachs upgrades to buy from neutral. Adds the shares to the conviction buy list. Reduces estimates to reflect higher interest costs and dollar weakness. Believes stock to be well positioned to outperform over second half. The company says a share buyback of up to 300 million should also be a positive for the stock and Wednesday’s update could re-affirm this intention. Lifts target price 6.50 from 6.48.
ROLLS-ROYCE was down 0.15 to 5.49… Credit Suisse downgrades to neutral from outperform, on valutation and headwinds concerns. Keeps target price of 5.70. Sees the company as a long-term core holding that should outperform the sector over the cycle, but at the current share-price prefers other companies in the sector. Expects solid first half results on July 26.
France
SOC GEN was up €1.04 to €139.79… Talk of potential Unicredit merger next year - A market source has reported talk that a merger between the company and Italy’s Unicredit could be on the agenda next year, following the latter’s integration with Capitalia.
VALLOUREC was up €2.10 to €229.75… Arcelor Mittal to bid at €280 - rumor - Market sources hear revived rumor that Arcelor Mittal is to bid for the company at €280 per share.
TOTAL («www.businessweek.com») was down €0.68 to €61.62… ING downgrades to hold from buy following recent strong performance and lifts target to €62.50 from €62.10. The broker notes the company is now trading near its modestly revised DCF target price. In other broker news, HSBC ups target to €73 from €66, keeping overweight, it admits largely on market movements. Believes Shtokman deal is ‘big on volume, but low on value’.
Germany
AIR BERLIN was down €0.66 to €15.90… Morgan Stanley places 1.25 million shares at €15.95 - €16.05, reportedly.
DEUTSCHE BANK was down €0.93 to €107.30… Shares slip on rumours of profit warning - The company ’s shares are off opening levels as rumours circulate in the market that the company may issue a profit warning, according to traders.
Italy
MEDIASET was down €0.03 to €7.65… Eyeing up Wind’s Tower Company - The company is showing an interest in Tower Company, owned by Wind and 3 Italia’s company. the company could team up with with the Benetton-Clessidra alliance in bidding for the tower portfolio. The Tower Company has been valued at between €1.2 billion and €1.5 billion of which EUR 700 million-€800 million are related to Wind infrastructure.
RCS MEDIA was down €0.08 to €4.13… Cheuvreux ups target to €4.70 from €4.50, rating outperform. Believes that in the next 12 months, the company might make large acquisitions, which could pave the way for further growth and a more efficient capital structure. Adds shares are currently trading broadly in line with the median of its European peers at 10.2x and 9.4x on 2008-09 EV/EBITDA.
Netherlands
REED ELSEVIER («www.businessweek.com») was down €0.34 to €14.36… Price for Harcourt is better than expected - The company has agreed last night to sell its education arm Harcourt to rival Houghton Mifflin for US$4 billion (US$3.7 billion in cash and US$300 million i common stock). Cheuvreux says total proceeds are around €500-600 million higher than consensus estimates.
ABN AMRO («www.businessweek.com») was down €0.15 to €37.00… Barclays looking at improved offer - FT - After yesterday’s revised offer for the company by the RBS-led consortium, Barclays is understood to be looking at ways to improve its offer for the company , including issuing ‘quasi equity’ such as convertible bonds, according to the FT. SocGen upgrades to hold from sell and raises target to €37.70 from €35.
Nordic
ELECTROLUX was up SEK13.50 to SEK174.50…
