Markets & Finance

JC Decaux Gains on Earnings


From Standard & Poor's European MarketScope

France

JC Decaux gained €1.13 to €19.70 Wednesday after showing a first half attributable net profit of €83.30 million, up 20.2% It expects fiscal year underlying sales growth of around 4%, with a slower profit growth rate at operating margin and EBIT levels, reflecting the slight first half revenue decrease in France and the higher revenue proportion from the lower-margin Transport division. SocGen says first half results confirm recent market adjustments on fiscal year EBIT, and kept its sell rating and €18.1 fair value.

Total rose €1.00 to €217.20. The company is awaiting the short list of potential partners for the Shtokman liquefied natural gas project that is to be announced on Sept. 16, according to Gazprom. Royal Dutch Shell, Sumitomo, Norsk Hydro, Statoil, Exxon Mobil, ConocoPhillips, Chevron and Sempra are other groups that are hoping to take part.

Hermes advanced €3.10 to €179.80 ahead of its first half results, set for release before the market opens Thursday. SocGen will be focusing on the quality, particularly in the different variations of provisions in the cash flow. ETC Pollak Prebon is expecting news on whether the company will be able to confirm fiscal 2005 revenue organic growth guidance of 8% and stable operational margin.

Germany

Allianz rose €1.12 to €104.62 on the news that it may purchase the rest of French unit Assurances Generales de France, AGF CEO Jean-Philippe Thierry told Handelsblatt. On the broker front, Citigroup upgraded the shares to buy from hold, lifting the target to €125 from €115.

Commerzbank fell €0.22 to €21.13 after confirming return on equity targets of at least 8% for 2005 and at least 10% for 2006. It sees 2005 loan provisions at below €700m, less than previously expected.

Netherlands

Royal Dutch Shell added €0.09 to €26.03. The company is awaiting the short list of potential partners for the Shtokman liquefied natural gas project that is to be announced on Friday 16 September, according to Gazprom. Total, Sumitomo, Norsk Hydro, Statoil, Exxon Mobil, ConocoPhillips, Chevron and Sempra are other groups that are hoping to take part.

Unilever was down €0.05 to €57.80 after a Wall Street Journal report quoted Tex Gunning, Unilever-Asia's VP, as saying that the company will increase prices in Asia on products with petrochemical components (laundry detergents) to absorb the higher crude oil prices. Kepler believes the negative consequences of such price increases could be more important than expected, given the high price awareness of Asian consumers. It says the issue raised by Gunning not only affects Asia but the company's worldwide business. The broker kept its reduce rating on the stock.

United Kingdom

Tullow Oil rose £0.10 to £2.29 after reports first half revenues of £201.43 million, up 163%, and operating profit before exploration activities of £108.40 million, up 318%. It says oil and gas prices are exceptionally strong and are forecast to remain so in the current supply environment.

Smith & Nephew fell £0.04 to £5.06 after UBS cut its price target to £6.40 from £6.5, retaining its buy rating. Morgan Stanley cut its target price to £5.69 from £5.92, retains overweight. ING trimmed its target price to £5.75 from £5.95, reiterates buy.

Diageo fell £0.20 to £8.09. Dresdner KW upgraded the stock to add from hold and lifted its target price to £8.75 from £8.0.


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