Broker snap: Impressive contract wins at Carillion

31st Jan 2011 10:39

An update from Carillion has provided Panmure Gordon with additional confidence in its earnings forecasts, after the contracting firm demonstrated positive contract momentum and made a start to the current year that gives cause for optimism.The construction and support services specialist announced over £360m of contract wins across all its divisions in its trading update on Monday. It also said it had signed a Memorandum of Understanding with the UK government to re-engineer procurement and service delivery."While this has no immediate impact on numbers, it should provide the opportunity for further work," said analyst Andy Brown. The group also said that it continues to expect "good profit and earnings growth,"The broker maintains its 'buy' rating, noting that Carillion's valuation remains at a discount to its Support Service sector peers. Target price is 400p.