Broker tips: Dr Martens, Hammerson, ITM Power

(Sharecast News) - Analysts at Barclays cut their target price on iconic bootmaker Dr Martens from 480.0p to 360.0p on Wednesday but said it still sees as much as 50% upside to the stock's current price. Barclays noted that Dr Martens had recently published consensus estimates that came ahead of its close period and, given a March year-end, it believes that the company continues to be in a position to achieve market expectations.

The bank, which reiterated its 'overweight' rating on Dr Martens' stock said it had updated its model to reflect stronger EMEA and Americas revenue and a weaker APAC performance.

"We make no changes to FY22 EPS but have lowered revenues slightly and raised margins. This implies Q4 revenue growth of +28% (1-year), and 53% (2-year)," said the analysts.

Barclays also lowered revenue/EPS by 1% reflecting macro factors, taking it to the bottom of the consensus range, or 4% below the FY23 company consensus EPS midpoint.

"On our forecasts, the company is trading on a Mar-23 PE of 13x and an EV/EBITDA of 8.4x, which we consider attractive for a global branded goods company with EBITDA margins of c28%.

JPMorgan Cazenove downgraded shares of shopping centre owner Hammerson on Wednesday to 'underweight' from 'neutral', citing a deteriorating consumer outlook and higher borrowing cost risk.

The bank, which cuts its price target on Hammerson to 29.0p from 40p, said refinancing risk remains limited near term, but Hammerson is worse positioned in terms of loan to value, debt maturity and pricing power than JPM's coverage universe.

"With LTV at 47%, we believe near-term disposals will continue to dominate HMSO's narrative, but these could prove harder to execute given the outlook for investment liquidity," it said.

JPM cut its FY22/23 earnings per share estimates by 20% - in line with its estimates for Klepierre and Unibail-Rodamco-Westfield - due to higher disposals and deteriorating retail sales assumptions.

RBC Capital Markets upgraded ITM Power on Wednesday to 'outperform' from 'sector perform' and hiked its price target on the stock to 500.0p from 300.0p.

The bank said that while there remain uncertainties around the timing of large purchase orders and ramp-up costs potentially affecting near-term profitability, it sees the growth positioning of ITM significantly de-risked amidst the current market dynamics.

"Our detailed analysis of electrolyser stacks also suggest ITM is more protected from major raw material disruptions relative to peers," it said.