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Cantor flys easyJet target higher

Cantor Fitzgerald has flown the target price up on budget carrier EasyJet today, following the firm's uplift in profit guidance last week.

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EasyJet received a target price push today from Cantor...

Cantor Fitzgerald has flown the target price up on budget carrier EasyJet (LON:EZJ) today, following the firm's uplift in profit guidance last week.

Summer demand has been strong, said the broker, and it expects this to continue through the autumn and winter, as people seek winter sun.

"We expect strong demand to continue through the autumn and winter, driven by sunshine getaways and also with continuing expansion at bases including Amsterdam, Hamburg, Naples and Porto," said analyst Robin Byde.

Overall,  the broker lifted its full year 2015 pre-tax profit by 7.6% to£693mln, 7.2% to £747mln for 2016 and by 4.6% to £802mln in full year 2017.

The rating is a repeated 'buy' and the target goes to £20 from £19.

In contrast, the same broker is less impressed with baby and toddler group Mothercare (LON:MTC), on which it repeats a 'sell' rating. The target price is pushed along to 140p from the 90p it had on the stock before the £100mln rights issue.

The broker reckons the shares are 40% overvalued on the 2016 EPS estimates of 8.7p.

UK energy utility Centrica (LON:CNA) gets a mixed bag from the analysts today, with Bernstein upgrading it to 'outperform' from 'market perform'. Swiss bank UBS has a different view however, putting it to 'sell' from 'neutral'.

Elsewhere, in brokerland, education publisher Pearson (LON:PSON) is upgraded to 'add' from 'reduce' by Investec, the banking and asset management specialist, which adds, however, that it still sees pressure ahead for the group.

The change in rating is attributed to the recent underperformance of shares.

Key to the upside is effective redeployment of capital given ‘cleared decks’ and low debt via merger and acquisitions, said the broker.

"That said, we still see mid-term pressure with limited evidence of positive structural/cyclical education drivers in numbers and flattish EPS growth in FY16E despite extensive restructuring," it added.

Last month, the owner of the FT sold its 50% stake in well-known financial news magazine The Economist to the investment arm of the Italian family that founded car giant Fiat (now Fiat Chrysler).

In small caps, Haydale Graphene's (LON:HAYD) composites division is to collaborate on an 18 month aerospace research project in a bid to produce a material less likely to be damaged in the event of an aircraft lightning strike.

NATEP is providing a grant of up to £150,000 towards the £300,000 cost of the research project, of which Haydale will receive up to £100,000.

Broker Cantor Fitzgerald repeated a 'buy' and target price of 200p on the shares (current price: 140p) following the news.

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