STOCKS NEWS UK-Wetherspoon up on refinancing, divi hopes
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09:21GMT 04Nov2009-Wetherspoon up on refinancing, divi hopes
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Shares in JD Wetherspoon (JDW.L) gain 2.6 percent after the pubs group says it expects to complete a refinancing of its debt by March next year, raising hopes it will resume dividend payments and overshadowing a slowing in the rate of its sales growth. [ID:nL3356308]
Wetherspoon said it will start formal talks with lenders before the end of the year over the refinancing of a 435 million pound facility due to expire in December 2010.
"They should be completed well ahead of prelims in September 2010, making Wetherspoon the first pubco to restore its dividend," says analyst Paul Hickman of KBC Peel Hunt.
Wetherspoon reports like-for-like sales growth of 0.3 percent in the first quarter to Oct. 25, below the 1.2 percent growth seen in the first six weeks of the period and over the previous year.
"Although this lower LFL increase may look disappointing, Wetherspoon has proved its value-driven strength in the recession to date," Hickman says.
Reuters messaging rm://matthew.scuffham.reuters.com@reuters.net
09:16GMT 04Nov2009-Aviva up on surplus increases
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Shares in UK insurer Aviva (AV.L) climb 7.2 percent, topping the FTSE 100 .FTSE leaderboard, after it posts an increase in surplus capital of 3.7 billion pounds ($6.09 billion) in its third-quarter trading update amd as investors shrug off a dip in sales.
"The shares are inexpensive (and) with capital off the table as an issue and with positive operating leverage should volumes return," Morgan Stanley says in a note. It maintains its "equal weight" on the stock.
Aviva says the insurance group directive surplus -- an FSA regulatory measure which calculates surplus capital within the group -- will increase further once it includes the 0.4 billion pounds from the sale of its Australia business. For more double click on [ID:nL4413629]
Reuters Messaging rm://david.brett.reuters.com@reuters.net
09:14 GMT 04Nov2009-WSP falls after update
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Shares in WSP Group (WSPG.L) shed more than 2 percent after the building and environmental consultancy issues a trading update, which Altium Securities says contains no real glimmers of positivity.
The group says trading since July 1 continues to be in line with its expectations, as it says market conditions remain very challenging with difficult trading conditions in most markets in the private sector. [ID:nBNG399574]
"We are likely to slightly reduce our forecasts for FY 2009 which are currently towards the upper end of the range, as translational currency benefits do not seem to be offsetting trading pressures to the extent we had predicted," Altium says in a note.
However, the broker says its sub-consensus FY 2010 estimates remain unchanged, and it repeats its "buy" rating on the firm, based on the attractive and well-covered dividend yield and its discount to other heavily internationalised consultants peers.
Reuters Messaging rm://tricia.wright1.reuters.com@reuters.net
08:51GMT 04Nov2009-M&S, Next up on positive updates
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Shares in two of Britain's biggest clothing retailers, Marks & Spencer (MKS.L) and Next (NXT.L), rise 5.5 percent and 4.1 percent respectively after reporting positive trading updates.
M&S, up 18.9 pence at 359.7 pence to top the FTSE 100 .FTSE gainers, posts flat first-half profit, towards the top end of expectations, while Next, up 74 pence at 1885 pence, reports better-than-expected third quarter sales and raises its full-year sales and profit guidance.
"Following these (M&S) results we see 40-50 million pounds ($65.88-$82.36 million) upside risk to consensus profit before tax estimates of 580 million pounds," say analysts at BofA-Merrill Lynch in a note.
For more double click on [ID:nL3585134] [ID:nL3585427]
Reuters Messaging rm://james.davey.reuters.com@reuters.net
08:47GMT 04Nov2009-BA climbs ahead of H2; UBS upgrades ------------------------------------------------------
Shares in British Airways (BAY.L) rise 2.9 percent ahead of its second-quarter results later in the week, with UBS upgrading its stance on the airline to "buy" from "neutral" on valuation grounds.
The broker also upgrades its recommendation on Air France-KLM (AIRF.PA), which rises 2.8 percent, to "neutral" from "sell" citing valuations. It says recent falls in the two airlines' shares, on the back of worries over the cost of fuel and yield pressures, may have been overdone.
"Since the recent highs we have seen BA and AFK fall (around) 37 percent and 27 percent respectively. We think the correction is now overdone," UBS analysts say in a note.
The broker says in the short term a higher fuel price should be supportive for yields as it dissuades inefficient capacity from returning.
After factoring in higher fuel costs at $77 a barrel, the broker adjusts downwards the target price for British Airways to 215 pence from 240 pence, cuts Air France-KLM to 11 euros from 12 euros, cuts Lufthansa (LHAG.DE) to 14.50 euros from 16 euros and adjusts Iberia (IBLA.MC) to 2.10 euros from 2.50 euros.
Lufthansa shares are up 1.7 percent and Iberia rises 1.9 percent.
Reuters Messaging rm://harpreet.bhal.reuters.com@reuters.net
