Markets & Finance

On the Move: Telecom Italia, DCX, Vodafone


Plus:Alitalia, Novartis, Iberia and other European companies making headlines Monday

From Standard & Poor's European MarketScope

United Kingdom

VODAFONE (VOD) was up £0.01 to £1.37. Exane cut its target to £1.51 from £1.56, and kept its outperform rating. The company said the UK margin squeeze is very much UK specific, hence it has cut its valuation only on the UK: target price cut 3p due to the UK, 2p due to the integration of Hutch Essar. The company reiterated its rating on better visibility than many incumbents in terms of OpFCF outlook not reflected in the valuation.

NORTHERN ROCK was down £0.09 to £11.36. The company said it continues to trade strongly in the first quarter 2007 - in line with guidance given at the time of the 2006 results. The company said total lending in the first 3 months of 2007 was 34% higher than the same period last year.

France

FRANCE TELECOM (FTE) was up €0.37 to €20.14. AT&T (T) may buy a stake in Telecom Italia (TI) from Pirelli, the FT wrote.

DEVOTEAM was up €1.00 to €33.00. The company acquired auSystem's main subsidiaries outside Sweden for SEK92 million and now targets €360 million sales and 32% operating margin for 2007.

Germany

DAIMLERCHRYSLER (DCX) was up €0.81 to €62.21. Bids for Chrysler were expected from Cerberus and at least two other potential buyers, according to the WSJ. Die Welt am Sonntag wrote that the company could receive between US$6 billion and US$9 billion from the sale of the unit.

HOCHTIEF was up €0.89 to €76.89. Construction industry union IG Bau and employers have agreed to a new wage deal of a 3.5% hike for some 700,000 workers in the sector. On the broker front, WestLB lifted its target to €82 from €77, reiterating hold. The company said the valuation is not excessive. It expects the company's valuation to be boosted by growth in the airport operations and concessions business.

Nordics

NOKIA (NOK) was down €0.25 to €16.98. The company cut its 2007 market outlook for its fixed and mobile telecom infrastructure and said it expects the Nokia-Siemens network to experience very slight market growth in Euro terms in 2007.

MEDIVIR was up SEK3.50 to SEK56.50. Swedish financial daily Dagens Industri put a buy recommendation on the stock.

Spain

IBERIA was up €0.04 to €4.03. Citigroup upped its target to €3.75 from €2.90, sell. It advised investors to take profits. Exane upgraded the company to neutral from underperform and lifted its target to €3.60 from €2.50.

INDITEX was up €0.95 to €47.48. The company has hit a three-year cost goal in just 12 months, but it still sees more work ahead to ensure that the profitability plan remains in place, Reuters said quoting a company official.

Italy

TELECOM ITALIA was up €0.20 to €2.34 on news that Pirelli is in exclusive talks with AT&T and America Movil over the planned sale of its controlling stake in the company.

ALITALIA was up €0.05 to €1.00. The company's shares have been suspended ahead of a statement. Today is the closing date for the offers of interest in the Italian government's sale of its controlling stake in the company.

Switzerland

NOVARTIS (NVS) was down CHF2.40 to CHF67.30. The company is cutting its 2007 sales forecast after taking bowel drug Zelnorm from US shelves at the request of regulators because clinical trial data indicate a possible link to heart attacks and strokes.

SYNGENTA was up CHF0.10 to CHF232.60. The USDA was projecting a 15% corn increase and 11% soybean decline in 2007, Deutsche Bank noted.

Netherlands

ABN AMRO (ABN) was down €0.12 to €32.10. Barclays (BCS) intends to make cost cuts of more than £3 billion in its proposed merger with the company, a move likely to lead to the loss of hundreds of jobs in the company's investment banking operations in London, according to The Sunday Tekegraph.

Claudia Perotti, Lydia Carroll, Sara Oscarsson, Isabell Witt, Michael Sanderson, Gaurav Panchal, Julien Manrique, John West, Ben Marino, Emma Stevenson, Pawan Girglani.

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