Brokers note - HMV Group
Singer Capital Markets has re-iterated its Buy recommendation on HMV ahead of its interim management statement on Thursday (September 3).The broker says it expects a like-for-like sales increase of around 2% for the 18-week perio d being reported and anything above this should be regarded as a positive signal. Compared with the same period last year HMV has been negatively impacted by the weather and a weak games market, but has benefited from Michael Jackson and the demise of Woolworths and Zavvi.
Singer Capital Markets believes the management statement could include further strategic initiatives from chief executive Simon Fox who has crucially being retained by HMV having turned down a possible move to ITV.
HMV is trading on a PE of just over 8x earnings for 2010 at the current price of 118.9p, which compares with the broker's target price of 175p.
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