On the Move: Alstom, Merck, Ericsson
TESCO was up £0.18 to £4.33... Lehman upgrades to overweight from equal weight and raises price target to £5.25 from £4.43. The broker says both the Asian and European components of the company 's international business should drive long-term value for the shares.
NEXT was up £0.78 to £19.39... first half pretax profit tops consenus, cautious on outlook - the company posts first half pretax profit of £198.2 million, ahead of consensus expectations. Directory sales increased by 3.5% in first half. The company says the combined sales of Next Retail and Next Directory for the six-week period to 8 September were down 2.9%. the company says it remains cautious about the outlook for the UK consumer and is aware that the full effect of recent interest rate rises has not yet filtered through to consumers. Expects Retail like-for-like sales to improve in second half and fall within a range of -1% to -3.5%, and Directory second half sales to be between -2% and +2% on last year.
WOLSELEY was up £0.36 to £9.64... Spends £87 million in five acquistions Announces five bolt-on acquisitions of £87 million. Explains that in FY, these new businesses are expected to add £110 million to total revenue. Adds goodwill and intangible assets related to these acquisitions are estimated to be by £52 million.
ALSTOM was up €8.27 to €136.06... Govt. explores nuclear options - press - The French govt. has set up a working group including HSBC and McKinsey to explore the future of the state's nuclear holdings, according to Les Echos. The paper adds that officially 'all options are on the table,' but that some kind of coming-together between Areva and the company seems preferred by the govt. Market talk has long focused on the possibility of a grand tie-up between Areva, the company and Bouygues.
RENAULT was up €3.43 to €92.80... Unveils 10 new models in Frankfurt - the company yesterday unveiled 10 new models, including the Sandero (based on the low-cost Logan frame aimed chiefly at LatAm), at the Frankfurt International Auto Show, reports Reuters. the company CEO Carlos Ghosn is quoted as saying the launches will 'allow us to get back growth in Europe [...] and sell 800,000 more cars in 2009 than in 2005.' He reiterated op profit margin outlook of 3% in 2007, 4.5% in 2008 and 6% in 2009.
ARCELOR-MITTAL (MT) was up €1.51 to €46.64... Targets 20% shipment increase by 2012 - the company announces an internal growth plan this morning, targeting 20% increased shipments between 2006-2012, to reach 131 milliont. the company adds this plan will be officially presented at its scheduled investor day in Paris today. the company further notes that organic growth will come largely from its low-cost operations in developing markets (LatAm, Africa, Eastern Europe, CIS).
AIR BERLIN was up €0.84 to €13.12... More takeover speculation as Deutsche ups stake - Deutsche Bank's stake in the company rises to 16.36%, with the bank saying this is purely financial, not strategic, which encourages takeover speculation.
MERCK was up €5.32 to €97.70... Up on Erbitux news (broker action) - A Phase III study shows increases in overall survival in first-line Erbitux combined with vinorelbine plus cisplatin treatment of non-small cell lung cancer. UniCredit says this is really excellent news as lung cancer has in the past been a difficult indication for new therapies. The broker has increased its peak sales estimate from €800 million to €1 billion and the chance of launch from 40% to 80%. The resulting incremental NPV per share is €0.51. Rates stock buy. Sal Oppenheim upgrades the company 's stock to strong buy.
ENEL was up €0.06 to €7.68... Three-tranche bond worth US$5 billion - A planned three-tranche bond by the company will be worth around US$5 billion in total, Reuters says.
the company will use the bond to partly re-finance its bid for Spain's Endesa. The bond will have three tranches, for five, 10 and 30 years. In July the company 's board approved new bond issues for up €10 billion by March 2008. ABN raises target to €9.25 from €7.50, rates buy.
FIAT was up €0.32 to €18.87... Sales & marketing j/v with Severstal Auto - the company and Severstal Auto have signed a letter of intent to form a 50/50 j/v in Russia. The business will include sales and marketing of all the company branded vehicles in the Russian Federation, together with a manufacturing facility where the new Fiat Linea will begin production in 2008. the company 's Lancia unit has sold more than 75,000 cars in Italy in the first 8 months of 2007, c. 4.3% of the market. An increase of 8% of Lancia's sales volume, CEO Olivier Francois discloses at the Frankfurt motor show, where Lancia is presenting its new car, Musa. The brand now will concentrate on expansion abroad. the company is understood to be one of a number of Italian companies to set up investment vehicles, called conduits, to invest in derivatives, Finanza e Mercati reports.
ROYAL DUTCH SHELL (NL) was up €0.26 to €29.05... Oil surges towards US$78 a barrel after a series of attacks on oil and gas pipelines belonging to Mexico, the world's No. 5 crude producer. Meanwhile, all eyes are on OPEC, which is meeting to determine its production policy.
ERICSSON (ERIC) was up SEK1.32 to SEK25.80... Growing market share - At the company 's CMD in London today the CEO said its market share is increasing in all areas, with market share in GSM and HSPA exceeding 45%.
TELIASONERA was up SEK0.75 to SEK54.25... Odell promotes merger - Mats Odell, Sweden's Finance Minister in charge of the state's sale of its stake in the company , says he wants the company to merge with another telcoms group, Dagens Insutri reports. Market talk suggest Deutsche Telecom could be a prospective buyer.
SAAB was down SEK1.00 to SEK154.50... New bribe investigation - A new bribe investigation will be launched in relation to the lease of 14 JAS 39 Gripen planes to Hungry, Dagens Industri reports.
SACYR-VALLEHERMOSO Up €0.65 to €26.90... The broker action / Ex-chairman ups stake - the company 's former chairman Jose Manueal Loureda bought 96,000 shares in the company last week, taking his stake to 13.5%. ElConfidencial.com reports that some of the company 's shareholders want it to undertake a capital increase of €1 billion-€2 billion as a show of confidence. ING upgrades to buy from hold and lowers target to €32.40 from €42.40. Thinks the market has overreacted to the company 's two main threats: a legal fight with Eiffage and real estate exposure. Argues that the company offers an interesting but risky opportunity. UBS lowers target to €29.50 vs €39.50, neutral.
ZURICH FINANCIAL was up CHF4.50 to CHF342.00... UK flood claims less costly than expected - the company expects aggregate claims payments from the July UK floods to not exceed US$260 million before tax. Cheuvreux says this is far less than the June floods; the cost of which was first announced to be USD400 million and finally was USD414 million.