Macquarie has upgraded Cape (LON:CIU) to outperform (from neutral) which it says is due to the industrial services group resolving two key issues, including the Asbestos Product Liability litigation and a potentially unsustainable dividend.
The broker said: “This makes the investment case far more compelling in our view, allowing investors to focus on Cape’s operational performance which is strong and getting better with reduced risks of negative catalysts.”
Target lifted to 240p from 200p.
Analysts at Berenberg now recommend investors sell shares in Merlin Entertainments (LON:MERL) stating the Alton Towers operator is potentially one misstep away from triggering a material de-rating.
The bank said: “We initiated coverage of Merlin in November last year with the core view that momentum across the business could be slowing for reasons beyond just the weak market backdrop. The full-year results two weeks ago arguably confirmed just that.”
Target cut to 375p from 440p.
Meanwhile, JP Morgan Cazenove turned its attention to the mining sector and upgraded KAZ Minerals (LON:KAZ) to overweight (from neutral) following a 20% share price pullback and with balance sheet and project risks diminishing.
The City heavyweight maintained its underweight call on Antofagasta (LON:ANTO) and highlighted Randgold (LON:RRS), Acacia (LON:ACA) and Petra Diamonds (LON:PDL) – all rated overweight – as its top picks within the European metals and mining space.
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