Brokers bearish on Aviva and Direct Line
Date
6/30/2016 6:40:36 AM
(MENAFN- ProactiveInvestors - UK) Tom Howard, Wed
Deutsche Bank and Barclays Capital have taken the sword to several insurance and savings companies today.
Deutsche says that ''in the wake of last week''s Brexit vote, insurers have been hit by falling yields and general risk aversion".
Barclays added that insurance stocks have fallen ''indiscriminately'' since last week''s referendum and remains ''cautious on the (deteriorating) fundamentals of the sector,'' although it does say that some of the share price drops may represent a good opportunity for investors.
Insurance group Aviva PLC (LON:AV. had its target share price slashed by the two banks.
Deutsche trimmed its target price to 470p from 610p, while Barclays cut its target to 456p from 664p.
Fellow insurer Direct Line Insurance Group PLC (LON:DLG) also had its target price downgraded by the same two banks.
Deutsche cut Direct Line''s target price to 385p from 450p, while Barclays Capital lowered its price to 364p from 369p.
Legal & General Group PLC (LON:LGEN) was downgraded from an ''overweight'' rating to ''equal weight'' by Barclays Capital, which also lowered its price target for the stock to 200p from 298p.
Deustche Bank followed that path, cutting its target price for Legal & General to 215p from 298p.
The two banks were a little more mixed on RSA Insurance Group PLC (LON:RSA), with Deutsche trimming its share price to 480p from 515, while Barclays actually raised its price target slightly 551p from 545p.
Savings group Standard Life PLC (LON:SL.) also had its target price downgraded by both banks.
On a more positive note, oilfield services provider Petrofac Ltd (LON:PFC) was bumped up to a ''buy'' recommendation from ''hold'' by Jefferies International.
Although it trimmed its price target for the stock, Jefferies says the firm still has a strong order book that should see the firm deliver a recovery into its interim results due in August.
Gold mining giant Randgold Resources Ltd (LON:RRS) had its target price upped to 6700p from 5560 by Deutsche Bank.
The bank said the upward trend in the gold price is likely to ''remain so given the number of political risk events over the next 18 months'' hence the price increase.
In the world of the small caps, PureCircle Limited (LON:PURE) had its ''buy'' rating repeated by Liberum, with the broker also repeating its target price of 600p.
The reiterations come after shipments of stevia have been released by US customs, which Liberum notes as ''a positive step towards a full resolution of this issue which should support a recovery in the share price.''
Rambler Metals and Mining PLC (LON:RMM) had its ''buy'' recommendation and 12p target price reiterated by Cantor Fitzgerald.
The broker said Rambler''s Q3 results ''show a significant improvement in production and operating costs.''
Elsewhere, City firm Panmure Gordon looks at investment analytics firm StatPro Group PLC (LON:SOG) and repeats a ''buy'' after recent contract wins.
In early June it picked up a contract with a large Australian financial institution worth A$4.5mln (2.3mln) - NAB Asset Servicing- and it also announced a five-year contract with a global American financial institution.
"Our investment view is unchanged: 2016 is a pivotal year for StatPro. The forthcoming debut of Revolution Performance marks a key waypoint on a journey which started some seven years ago," said Panmure, which targets 132p a share (current around 83p)
Tom Howard