On the Move: Northern Rock, Schneider, BMW
UK
NORTHERN ROCK was down 0.20 to 1.74… Taking legal advice over dividend - the company is understood to have been taking legal advice about the payment of its forthcoming 59 million dividend, the FT writes. The company stands accused of reckless lending after it emerged this weekend that it is still offering mortgages of six times salary to potential borrowers, The Times reports. The company says despite provoking the worst banking crisis for decades, the company last week offered a reporter posing as a first-time buyer a 180,000 mortgage even though he had a salary of only 30,000. - The Sunday Telegraph reported that three leading hedge funds are planning a break-up of the company They, however, have yet to approach the company ’s board.
MARKS & SPENCER was up 0.21 to 5.88… Buy, 42% upside to target - Deutsche - Deutsche Bank says that the shares have underperformed the market by 20% over last 4M due to concerns that a slowing UK
consumer will hurt the business, and that the recovery has lost momentum. Broker believes second half will prove a positive surprise and that profits growth will re-accelerate. Suggests to buy now before news of improving autumn trading and before a possible large share repurchase program. Adds the market is underestimating the benefit of the modernization program. Rates buy with 8.15 target.
WOLSELEY was down 0.41 to 8.07… fiscal pretax profit falls, ups DPS; US still weak - posted fiscal pretax profit before amortization of 758 million, -7.3%; pretax profit 634 million, -17.6% (vs cons 817 million); revenue 16.221 billion, +14.%; basic EPS 73.52p, -19% (vs cons 98.8p); total DPS 32.40p, +10.2%. The company says recent events relating to the US subprime market and subsequent concerns over liquidity in global financial markets have created uncertainty. Adds there are no signs yet of any upturn in the US housing market and the repairs, maintenance and improvement market is now beginning to soften.
BHP BILLITON was up 0.98 to 17.54… Reserves update this week - the company is expected to announce this week that it has uncovered what is potentially the largest gold resources in the world at its Olympic Dam mine in South Australia, the Melbourne Herald-Sun newspaper writes. the company will release its resource upgrade for the copper, gold and uranium mine, as part of its annual report on Wednesday, the paper adds. France
EDF was up €2.02 to €72.56… The French govt may sell a 5% stake in the company , La Tribune reports. The company says the sale could happen this week.
SCHNEIDER was down €3.40 to €91.27… Citigroup downgrades to hold from buy and cuts target to €100 from €110. Argues the blow-up in the sub-prime market has been worse than it had expected and that the uncertainty caused is increasing weakness in the housing market and is likely to lead to a further slowing of commercial construction projects. Cuts fiscal 2008 EPS target by 5% to €7.48.
DANONE was up €1.06 to €57.57… Credit Suisse upgrades to outperform from neutral and lifts target to €67 from €65, arguing ‘the time to buy a quality stock is surely when it is out of favor.’ Stock is down 10% over 6 months. However, broker believes bad news is in the price and that the company will emerge as ‘the fastest growth food company in the developed world’.
VINCI was up €0.85 to €55.03… Eiffage granted a 1% toll tariffs hike - press - The French environment ministry is to grant a tariffs hike of 1% to Eiffage’s toll-highway operator unit APRR, according to French weekly newsletter La Lettre de l’Expansion. The company says the environment ministry should do the same with toll-highway operator Sanef, controlled by Spain’s Abertis, on 1 December, and with the company ’s toll-highway operator ASF on 1 February 2008. Germany
BMW was up €1.57 to €45.14…
