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Brokers: UK pharma giants in good shape if Clinton wins says Citigroup

Published: 09:22 07 Nov 2016 EST

picture of Glaxo buliding

Hillary Clinton’s proposals for US healthcare reform will, if she wins, create almost limitless outcomes, according to Citigroup with potential black swan outcomes in the event of a Democratic clean sweep.

“From a legislative angle, we continue to prefer names with either limited part D exposure [US Medicare] or heavier contribution of non-pharma assets."

Both UK flagwavers GlaxoSmithKline (LON:GSK)  and Astra Zeneca (LON:AZN) are buys on that basis for the broker.

Gold miner Randgold Resources PLC (LON:RRS) is about 20% undervalued, a gap that should close as it releases more cash to pay out to shareholders according to JP Morgan.

Berenberg is sticking with its buy case for gas utility Centrica (LON:CNA) even though the investment case has been a frustrating one.

Centrica offers an attractive dividend yield underpinned by improving earnings and cash flow backed by cost-cutting, a recovery in commodity prices not yet reflected in the share price.

" Politics continues to dog the investment case but we continue to believe that the market is overly bearish" ,says the broker.

The target price is 240p.

A rising coal price points to rising dividends from Anglo Pacific Group PLC (LON:APF), suggests broker Peel Hunt.

Last week, the resource investor reported a 147% increase in royalty income in its third quarter.

Spot prices of coking coal, used in making steel, are up 229% in the year so far and 110% for thermal coal (used, among other things, in generating  electricity). The target price goes from 128p from 108p

Ergomed PLC's (LON:ERGO) co-development deal with Asarina Pharma AB for Sepranolone enhances its pipeline, says broker N+1 Singer, which repeats a 'buy' rating and lifts the target by 10p.

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