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Risk Warning
06/06/2011
Prime Markets recommends to ‘buy’ Aegis shares, as it believes the stock remains attractive at current levels with or without the Synovate sale going through.
UK advertising and marketing group Aegis confirmed speculation on Monday that it is in talks with the research think tank Ipsos about a “potential transaction” of Aegis’s market research business Synovate.
Even without taking this deal into account, head of dealing at Prime Markets Richard Curr thinks that the group has shown solid growth already in the current year.
Between 1 January and 31 March, Aegis grew total group revenue by 16% (year-on-year) while organic revenue rose 9.1%.
“Although the outlook for advertising and marketing firms is decidedly uncertain at present, it seems that the Aegis business model is made of stern stuff, delivering impressive growth both at the full year numbers in March and in the trading statement a few weeks ago,” Curr said.
He adds that a £500m injection from a potential Synovate sale could really “put some fizz” into the share price.
A target price of 154p is confirmed.
Securities and Derivatives markets may be subject to rapid and unexpected price movements and past performance is not necessarily a guide to future performance. Trading in these markets is generally considered to be suitable only for the more experienced investor as it carries a high degree of risk. An investor may not receive back the amount of their original investment and in certain circumstances may be liable for a sum that is greater than their original investment. If in any doubt, please seek independent financial advice.