Newspaper article The Evening Standard (London, England)

Persimmon Is Shaken by Goldman Demolition Job

Newspaper article The Evening Standard (London, England)

Persimmon Is Shaken by Goldman Demolition Job

Article excerpt


GOLDMAN Sachs poured fresh misery on the housebuilders today,downgrading Persimmon , off 25p at a record low of 403 3 / 4 p, from neutral tosell with its target slashed from 476p to 309p.

It does not expect Persimmon to remain isolated from an accelerated downturn inthe housing market or a potential writedown on land banks.

Persimmon will lose its place as a constituent of the Footsie 100 in tomorrow'squarterly review.

Fresh speculation about a rights issue left rival builder Barratt Developmentsdown 14p at 106 3 / 4 pwhile Berkeley shed 15p to 767p, Redrow 15 1 / 2 p to182p, and Bovis 7 1 / 2 p to 364p.

Mining shares, were making much of the running, and if you thought they werelooking a bit toppy, think again.

That is the message from Morgan Stanley, which believes they still lookattractive and says some miners have the scope to double again in price.

That is despite a phenomenal run of late that has lifted the sector by 600% inthe past five years as the price of raw materials reaches record levels onincreased demand from emerging countries.

Morgan Stanley sees support for this rally from the "stronger-for-longer"outlook for commodity prices, tremendous cashflow generation and the absence ofdebt on the balance sheets.

Its top picks are Vedanta Resources, 71p dearer at 2354p, which it has beguncoverage of with an overweight rating and 3500p target, and Eurasian NaturalResources Corp, up 76p at 1401p, (overweight, 2000p target). Its targets forboth companies are up to 50% above consensus, and it says either of them coulddouble in price.

The US broking house also has overweight ratings on Kazakhmys , 34p higher at1651p, in copper and Xstrata , down 17p at 4205p, among the large diversifiedmines. It has an equalweight rating on Aquarius Platinum , 5 1 / 2 p lighter at776p.

Despite the support of the miners, share prices generally were lower. Anunconvincing performance on Wall Street last night and big falls in the FarEast this morning set the trend. …

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