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FTSE Movers: Bodycote bounces, Barclays beats retreat

(Update) A busy reporting day sees shares in Bodycote (BOY.L), Range Resources (RGRS.L) and Aggreko (AGGK.L) rise but Barclays (BARC.L), ITV  (ITV.L) and AB Foods (ABF.L) are among the big fallers.

 
FTSE Movers: Bodycote bounces, Barclays beats retreat

(Update) A busy reporting day sees shares in Bodycote (BOY.L), STV (STVG.L) and Aggreko (AGGK.L) rise but Barclays (BARC.L), ITV (ITV.L) and Premier Foods (PFD.L) are among the big fallers.

ITV slides following Barcap downgrade

Broadcaster ITV (ITV.L) was among the biggest losers on the FTSE 100, shedding 2p to 74p, after Barclays Capital downgraded its rating to ‘equal-weight’ from ‘overweight.’

The fall also came after a long-running legal dispute between the firm and Scottish Broadcaster STV was settled amicably. STV agreed to pay ITV £18 million to end a dispute triggered by the Scottish firm’s decision to drop high profile programmes such as Midsummer Murders and Marple.

STV soars on settlement

FTSE Fledgling index-listed STV (STVG.L) soared 19p, or 14 %, to £1.55 following the move, as Numis upgraded the stock from ‘hold’ to ‘buy.’ The broker also raised its target price to £1.71 from £1.31.

Numis analysts pointed out that under the settlement, STV had agreed to pay £11 million in programme rights, £2 million in opt-out credits and £5 million in cash. ‘The cash impact of £5m is materially lower than the £20m we had factored in and results in a £15 million uplift in our valuation,’ they wrote in a research note.

Game Group jumps

Among small-cap stocks, Game Group (GMG.L) bounced 5p, or 11%, to 50p from an eight-year low after the video games retailer said it expected market conditions to improve in the coming.

Noting that the firm was operating in a ‘very challenging’ economic climate, Ian Shepherd, chief executive, said Game Group had ‘a lot to do and a long way to go’ in order to outperform the market by growing new revenue streams. ‘Our strategy is designed to do just that, and our dedicated teams around the world are focused on delivering it,’ he added.

Analysts at Investec said there were ‘no major surprises’ within Game's preliminary results, pointing out that profit before tax of £37.8 million came in within a tight market range of £37-£39 million.

They added: ‘Short-term trading is likely to remain challenging, although Nintendo's
re-launch of the Wii console in 2012 marks the first in what should be a series of expected hardware platform launches, kick-starting the next 4G games cycle.’

Bodycote keeps on trucking

Bodycote (BOY.L)  bounced 47p, or 14% to £3.83 after the engineering firm said demand from heavy truck makers would produce operating profit this year at the top end of analysts' forecasts, which currently range between £55 million to £76.6 million. Total first quarter sales jumped 19.2% higher than a year ago.

Harry Phillips of Evolution Securities raised his target price to £4.70 on the back of the 15.1% margin now forecast in 2012. He wrote: ‘It is interesting and encouraging to see that Bodycote is within touching distance of our “more measured approach” scenario which has sales of £650 million (we are forecasting £615 million in 2013), margins of 17.2% and target price of 621p. The changing profile of the business is very evident in the numbers and this will now start to be reflected in the share price.’

Meanwhile Arbuthnot analyst Michael Blogg reiterated his ‘buy’ recommendation and raised his price target to 400p from 380p. Altium lifted its full year 2011 profit before tax and earnings per share estimates by 17% and by 14% for 2012 and retained its ‘buy’ recommendation.

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