Wall Street bank has downgraded miner () to 'neutral' from 'buy' and says now might be a good time for investors to take profits.
"Anglo?s share price has rallied 26 per cent since its 12-month low of ?21.38 on October 4, due partly to widespread corporate action speculation (as reported in Bloomberg, for example), in our view," said Citi analyst Heath Jansen.
The analyst said several operational challenges, along with a relatively unattractive valuation could mean now was a good opportunity for investors to take profits.
Citi has also reduced its target price for the stock to ?30 from ?33 previously.
On the operational challenges in the medium term, Jansen cited ongoing operational issues at Anglo , significant cost pressure at Kumba Iron Ore due to increasing mining complexity,? ongoing issues at Minas Rio, and the potential for higher taxes in South Africa. To that list, it added the potentially negative news flow relating to Codelco?s option to acquire 49 per cent of Anglo Sur.
He added that Anglo was trading at a one-year forward P/E premium to both of its large peers, () and (). Earnings forecast momentum is negative and we believe forecasts could fall another 16 per cent if spot commodity prices and exchange rates persist. Its one-year forward dividend yield also looks less competitive than peers?, he said.
Elsewhere, has increased its target price for () to 1920 pence from 1875 pence to reflect higher sustainable LNG (liqueified natural gas) earnings.
It has reiterated its 'overweight' stance on the stock and said BG?s LNG business looked set to deliver higher earnings for longer than it had previously assumed and added that delivery on its upstream projects were progressing well.
Credit Suisse has today maintained its 'neutral' rating on () but said that the stock retained a "highly attractive" strategic outlook.
It has raised its target price 24 per cent to 189 pence for the stock (current price: 174.4 pence).
This positive outlook from Credit Suisse arises from a likely consolidation of bmi and the development of JBAs with American Airlines/JAL, it said in a note out today.
"However, we think recent US$/fuel price gains limit the scope for FY12 upgrades, which may weigh on short-term momentum. Accordingly, we remain 'neutral'," added the investment bank.
In tobacco, has issued a note on Group (), on which it maintains its 'buy' rating.
Analyst Martin Debobo said that first quarter volumes were bad as had expected. But softer comparatives, and perhaps better times, lay ahead, he said.
"Our forecasts change little, on the premise that what looks set to be a benign industry pricing environment in 2012 should provide some latitude to catch up. So we stick to our 2660p price target and stay on board for the cash returns and - on a longer term view - a potential take out," he said.
In other coverage, () today reported a strong third quarter, in which it said underlying performance had outperformed the firm's expectations.
Since the end of January, trading has continued to forge ahead and the company was now convinced it would meet its full year EBITDA target of ?215 million, it said.
Freddie George, retail analyst at broker Seymour Pierce, maintained his 'buy' stance on the stock and upgraded the price target.
"We upgraded to buy in December 2011 following the company?s half year results. Since then the stock has risen by over 25 per cent, significantly outperforming the market over this period.
"We are retaining our buy recommendation and upgrading our price target from 240p to 285p, at which level the stock is rated at broadly 15x FY12E earnings."
George said the reasons for the target price upgrade were the relatively low valuation at the time and secondly, the significant operational gearing in FY13 earnings from the forthcoming sporting events of 2012 and thirdly, the significant opportunity to develop internet sales.
Meanwhile, Numis Securities has highlighted the strong growth potential of online dating firm Cupid () after its latest acquisition saw three brands added to the portfolio.
Cupid announced yesterday it was paying ?600,000 upfront and a further ?200,000 when targets are achieved to acquire the rights to operate the "Friends Reunited Dating", "Friends Over Fifty" and "Swoon" online dating brands.
Numis analyst Ivor Jones called the latest deal ?a useful fill-in acquisition? and added: ?This highlights how, even after Cupid has established a footprint in multiple countries, it will have further growth potential from consolidating less-efficient operators.?
He expects a short payback on the investment and that revenue growth of the acquisition will accelerate under Cupid's control.
He has a ?buy? rating on the stock and a target price of 325 pence.
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