A sell note from broker Albert E Sharp and the view of another, Panmure Gordon, that Vickers’ shares are at best only a weak hold, along with a negative note in an investment magazine, combined to depress its price close to last year’s low, although it has since perked up a little.
Sharp sees the outlook for this year as `subdued’ and argues that there is better value to be had elsewhere in engineering. Panmure has downgraded its profits forecast by £10m for this year and next on currency fears and the dull performance of the medical division.
Both brokers believe the new Rolls-Royce model of car will enhance Vickers’ prospects from 1998.
British Steel lost ground sharply as the pound soared to a five-year high against the German mark. Watchers believe the firm’s dividend is safe, but worry about the impact of adverse exchanges on European sales.
Babcock gained several pence on news that one of two top jobs in the company has been filled, with Nigel Young from First Technology named to succeed Erik Porter as finance director. But it still needs a successor to chief executive Nick Salmon who leaves in June.
Siebe’s shares quickly shrugged off broker NatWest Securities’ view that its growth rate is set to slow and that investors should cut their holdings. After a brief downward flip, the shares headed towards the £10 mark again.