Broker tips: HSBC, Rotork, Centamin

2nd Aug 2011 11:39

RBS has downgraded its rating on global banking giant HSBC from buy to hold and lowers its target price from 750p to 640p, due to uncertain economic conditions in the US and Europe."The prospect of slowing economic growth in the US and Europe delays the all-critical gradual rise in US policy rates required to drive a re-rating," RBS said.The broker notes that 64% of HSBC's customer loan book is generated in Europe and the US, as well as 55% of risk-weighted assets and 52% of underlying group revenues.Peel Hunt expects to make upgrades to its full-year forecasts for Rotork, following the engineering group's strong interim results."Whilst Rotork never looks cheap in valuation terms the recent sell-off is a buying opportunity [...] A small premium to the sector by historic standards and offering good value for one of the highest quality names in the sector," Rands said.A buy rating and target price of 1,825p are kept.Ambrian has maintained its buy rating on gold miner Centamin Egypt despite the group slashing its full-year output estimates on Tuesday.While analyst Adam Kiley does indeed call the downgrade in forecasts "disappointing", he notes that in Ambrian's recent research note on Centamin, the broker highlighted short-term concerns over production output at the Sukari mine and uncertainty on the timing of underground production.Nevertheless, the broker says that it believes that "short-term share price weakness over the coming months will offer a discounted opportunity to buy into a world-class asset," Kiley said.BC