JPMorgan Cazenove upgraded Weir Group to ‘overweight’ from ‘neutral’ on Thursday and lifted the price target 1,970.0p from 1,800.0p, citing a good entry point.
JPM said the pullback in Weir’s shares since the interims had renewed interest in the stock, with investors questioning whether this is a buying opportunity.
“Weir is the highest quality asset amongst the downstream mining peers, with still to recover late-cycle exposure to a fundamentally attractive end-market,” it said.
JPM noted the shares have underperformed the sector by around 35% year-to-date and trade at a 25% discount on one-year forward price-to-earnings versus 10% historically, despite the sale of Oil & Gas.
“We would expect the stock to re-rate, closing this discount, as the later cycle recovery drives strong order and earnings growth over the medium term,” JPM said. “Now is a good entry point and we upgrade Weir to overweight.”
Analysts at Peel Hunt upgraded their rating on Holiday Inn owner InterContinental Hotels Group from ‘reduce’ to ‘hold’ on Thursday after upping their full-year forecasts for the company.
Peel Hunt, which also reiterated its 4,600.0p target price on the stock, increased its forecasts for full-year 2021 underlying earnings by 4% to $564.0m, while pre-tax profit and earnings per share estimates were both hiked 8% to $316.0m and $1.11 per share, respectively.
The investment bank stated that in InterContinental’s first-half analyst presentation last week, management highlighted the company’s potential for future growth.
“Early next year, after removing more underperforming hotels, we expect net system growth to return and for this to have a positive impact on sentiment,” said Peel Hunt.
“Taking account of this, plus the forecast upgrade we have made today and recent share price weakness, leads us to upgrade to ‘hold’.”
Over at Citi, analysts kept their recommendation for shares of ITM Power at ‘buy/high risk’ after its joint-venture partner, Linde, inked a deal for the British company’s technology with chipmaker Infineon.
Citi said the move further opened up a “potentially significant” end market for green hydrogen in general and for PEM electrolyser technology in particular.
The agreement also “positively affirmed” the JV with Linde, “creating further opportunities for ITM with large, credible industry leaders such as Infineon.”
Under the terms of the deal, Linde would build a 2MW electrolyser plant using ITM’s technology at Infineon’s Villach site in Austria.
