Monday, November 2, 2009

LONDON Broker Recommendation Round up Monday, November 2, 2009, 8:45AM ET

Broker tips: RBS, Glaxo, Tesco

Royal Bank Of Scotland (RBS) shares were out of favour on Monday morning after the part-nationalised bank issued a statement about the status of its negotiations about participation in the government asset protection scheme (APS).

Broker Charles Stanley said ‘the big news in this statement is that RBS will be required to make divestments “not initially contemplated”.’

Charles Stanley had been expecting RBS would be forced to reduce its market share in the small business area, ‘possibly dispose of its RBS branded branches in England and sell off its insurance brands.’ Monday’s announcement suggests that the sell-off may be more extensive than that.

‘There is also speculation as to whether the fees for the APS and the amount of the assets to be insured will be reduced but that the first loss borne by RBS will be increased,’ Charles Stanley analyst Nic Clarke notes.

Clarke thinks the shares will remain under selling pressure until the bank makes a fuller announcement later this week. The broker’s recommendation on the shares remains ‘hold’.

Broker Recommendations

DateCompany NameTickerBroker NameRecommendPriceOld Target PriceNew Target PriceBroker Change
02-Nov-09ArrivaARIRoyal Bank of ScotlandBuy432.10p540.00p685.00pReiteration
02-Nov-09GlaxoSmithKlineGSKShore CapitalHold1,239.50p--Reiteration
02-Nov-09HSBC HoldingsHSBAUBSBuy679.90p775.00p-Reiteration
02-Nov-09InvensysISYSEvolution SecuritiesBuy289.30p--Reiteration
02-Nov-09Lloyds Banking GroupLLOYNCBSell85.19p39.00p-Reiteration
02-Nov-09Morrison (Wm) SupermarketsMRWOrielHold280.70p--Reiteration
02-Nov-09Rio TintoRIOCitigroupBuy2,773.50p3,300.00p-Reiteration
02-Nov-09Royal Bank of Scotland GroupRBSCSFBUnderperform38.75p--Reiteration
02-Nov-09Shire PlcSHPCitigroupBuy1,064.00p1,715.00p-Reiteration
02-Nov-09Shire PlcSHPAstaire SecuritiesBuy1,064.00p1,250.00p-Reiteration
02-Nov-09Weir GroupWEIRDaniel StewartBuy691.50p801.00p-Reiteration
02-Nov-09WPP GroupWPPRoyal Bank of ScotlandBuy545.50p650.00p665.00pReiteration
02-Nov-09WPP GroupWPPCitigroupSell545.50p--Reiteration
02-Nov-09WPP GroupWPPMorgan StanleyUnderweight545.50p458.00p-Reiteration
02-Nov-09WPP GroupWPPGoldman SachsBuy545.50p650.00p676.00pReiteration

Other Company Recommendations Today

Abcam, Aggreko, Alternative Networks, Alternative Networks, BowLeven, Cairn Energy, Carpetright, Chloride Group,Chloride Group, Chloride Group, Croda International, Debenhams, Dimension Data Holdings, Dragon Oil, F&C Asset Management, Griffin Mining, Halfords Group, Marston's, Mortice Ltd, PV Crystalox Solar, Randgold Resources, Randgold Resources, Royal Dutch Shell 'B', Royal Dutch Shell 'B', Sainsbury (J), Soco International, Sylvania Resources, Telecity Group, Telecity Group, Tesco, Virgin Media Inc., Weatherly International, Zotefoams

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