UK Wage Growth Momentum is Easing, But Pace Is -3-

0956 GMT - Fresnillo's prospects are less negative than they were, UBS says, upgrading the Mexican silver miner to neutral from sell and its price target to 825 pence from 700p. The Swiss bank downgraded Fresnillo to sell in January as it believed market cost expectations for 2022 were too low and it thought 2023 production guidance could fall. Those negatives have largely played out and with the stock down about 20% in the last three months, risk-reward is more balanced, UBS says. Still, Fresnillo needs to show evidence of sustained operational improvement to instil confidence in its medium-term outlook, UBS says, adding that European rivals are more attractive and reiterating buy recommendations on Endeavour Mining and Centamin. Fresnillo shares rise 4% to 805p. ([e-mail])

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Antofagasta's Improving Copper Outlook Should Lead to More Upgrades

0953 GMT - Antofagasta's improving bottom-up investment case and constructive medium-term copper outlook supports a premium share price, and the improving political backdrop in Chile combined with low risk organic growth could drive further upgrades medium-term, UBS says. The Chile-focused miner could appear expensive compared to peers, but copper has attractive long-term fundamentals, UBS analysts say in a research note. As the energy transition becomes more prominent, and given the limited pool of companies that offer predominantly copper exposure, Antofagasta's valuation gap is likely to expand further in the future, the Swiss bank says. UBS raises its stock rating to neutral from sell, and its target price to 1,650 pence, from 1,200 pence. Shares are up 2.5% at 1,648.5 pence. ([e-mail])

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Wise's Interest Income Seen Hedging Drop in Value Per Customer

0948 GMT - Wise posted a mixed but robust update, says AlphaValue analyst Gregoire Hermann in a note after the fintech group posted FY 2023 income ahead of its guidance and strong customer growth in the fourth quarter partly offset lower transaction volumes per customer. The slight on-quarter decrease in take rate--the fee taken per transaction--catches Hermann's attention as it implies a lower customer price charged sequentially while still remaining high. "Our thesis remains intact in that interest income hedged the momentaneous drop in volume per customer," Hermann says. AlphaValue rates the stock buy. Shares fall 14.6% at 500.2 pence. ([e-mail])

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Tatton Posts Impressive Results Given Sector's Slowdown in Flows

0945 GMT - Tatton Asset Management's update shows sector-leading organic growth, defying tricky market conditions, says RBC Capital Markets in a note after the asset manager posted an "impressive" GBP150 million net flow per month rate into the second half of fiscal 2023. "[We] reiterate our outperform rating on TAM, which we believe deserves to trade at a clear premium to peers due to sector-leading organic growth and return improvement prospects," say analyst Ben Bathurst and senior associate Rafael Castillo. RBC's target price on the stock is 550 pence. Shares trade flat at 450 pence. ([e-mail])

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Ninety One 4Q Assets Under Management Seen as Weak Compared With Peers

0931 GMT - Ninety One's assets-under-management performance is weak compared with its peer group, Peel Hunt says in a note. The asset manager posted a 2.3% AUM drop over the fourth quarter, the biggest fall in Peel Hunt's coverage which also includes Impax, Polar, Premier Miton and Ashmore. "The company provided no analysis of the AUM movement between flows and FX market movements, so the quality of the performance is opaque," the brokerage's analysts say, noting that since the group reports in British pounds, an around 7.5% weakening of the South African rand against the pound is likely to have held back its AUM figures. Peel has a hold rating on the stock. Shares shed 1.7% at 183.1 pence. ([e-mail])

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Antofagasta's Outlook is Improving, Shares Could Rise

0929 GMT - Antofagasta's outlook is improving and supporting its premium valuation, UBS says, upgrading the Chilean copper miner to neutral from sell and its price target to 1650 pence from 1200p. "We're constructive on the medium-term outlook for copper and believe Antofagasta's bottom-up investment case is improving," UBS analysts say in a note. While the company's shares trade at a premium to U.K. diversified mining peers, its enterprise value/EBITDA and dividend yield are comparable to key global copper peers, UBS says. "We don't see an obvious catalyst for a de-rating and believe an improving political backdrop in Chile, combined with low-risk organic growth, could drive a re-rating medium-term," the analysts say. Shares rise 3% to 1651p. ([e-mail])

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easyJet's Demand Could Suffer if Governments Don't Tackle Inflation

0925 GMT - easyJet is starting to recover its prepandemic capacity as passengers' appetite for a quick getaway hasn't been dampened yet but demand could start to falter if inflation isn't tackled in the U.K. and Europe, eToro analyst Adam Vettese says in a note. While fuel prices are starting to come down, thus helping the budget airline's bottom line into the summer, this effect might diminish as OPEC+ tries to sustain a higher oil price, Vettese says. However, at present there's no indication that prices are going to rise again, he says. The company says booking momentum is still strong and has lifted its forward guidance. Shares are up 11.60 pence, or 2.3%, at 522.60 pence. ([e-mail])

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Entain's 1Q Bodes Well for 2023 Guidance

0922 GMT - Entain's first-quarter performance was robust despite tough comparatives and this bodes well for it achieving full-year guidance and market estimates, Jefferies analysts say in a research note. Meanwhile, easier comparators are coming later in the year, they say. The gambling company's confirmation of second half profitability for BetMGM, with 1Q net gaming revenue also tracking full-year guidance should mitigate concern around market share losses, they say. Jefferies has a buy rating on the stock with a 1,805.00-pence price target. Shares trade up 2.6% at 1,339.00 pence. ([e-mail])

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THG's Prospects for 2023 Look Encouraging

0920 GMT - THG's 2022 performance was in line with expectations, while its cost-saving measures support a positive 2023 outlook, Liberum analysts Anubhav Malhotra and Wayne Brown say in a note. Despite negative growth in 1Q, the e-commerce company--known as The Hut Group--is focusing on higher margin sales, while its exit rate has improved and cost inflation is easing, they say. "The key to future outperformance is the delivery of free-cash-flow and an improving return on capital employed. The announced simplification to focus on the three core divisions should help achieve this," the analysts say. Shares, however, are down 5.8%, mainly reflecting the market's near-term focus on the takeover approach made by Apollo on Monday, they say. ([e-mail])

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UK Rate Rise Speculation After Wage Data May Support Pound

0916 GMT - Higher-than-expected wage growth in Tuesday's U.K. employment data strengthens the case for another interest rate rise at the Bank of England's May 11 meeting, which should support sterling, MUFG Bank says. Average earnings, excluding bonuses, rose 6.6% in the three months to February, in line with the previous quarter's growth. Analysts in a WSJ survey expected a 6.2% increase. "The recent slowdown in wage growth is less pronounced now after the jump in February," MUFG currency analyst Lee Hardman says in a note. "Speculation over another 25 basis points hike from the BOE in May will help to support the pound in the near-term." GBP/USD rises 0.5% to 1.2430 while EUR/GBP trades flat at 0.8828.([e-mail])

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EasyJet Has Strong Outlook; Sector Set for Sunny Summer

0911 GMT - EasyJet shares rise 3% after the European budget airline forecast better-than-expected full-year profit. "We see today's update as positive for the shares, although they rallied into numbers," UBS analysts say in a note. "The next expected catalyst is on May 18, when the company will present its full 1H23 results." UBS says it remains constructive on the airline sector and sees positive momentum for the summer season, driven by prices and linked to capacity discipline and demand. ([e-mail])

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IQGeo's New Customer Contract Highlights Ability to Win and Expand

0910 GMT - IQGeo's customer win with a tier-1 U.S. telecom is welcome, if not expected, finnCap says. The software developer has shown that its differentiated and complementary solutions can win and then expand with tier-1 telecoms, given its July contract win and February expansion with a global top-five telecom, analyst Lorne Daniel says in a note. Investors should look forward to further updates on the new contract in due course, Daniel says." We reiterate our forecasts... as today's win was included in the fiscal 2023 pipeline, and we look forward to further contract wins and expansions, strong operating and financial momentum continuing at the first-half results, and attractive acquisition opportunities," the brokerage says. finnCap reiterates its 230.0 pence price target on the stock. Shares up 6.6% at 225.0 pence. ([e-mail])

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Wise Volumes Likely to Remain Subued After 4Q Miss

0901 GMT - Wise investors are likely to be focusing on the drivers behind the group's lower-than-expected volumes for the fourth quarter, Peel Hunt says in a note. The fintech group posted volumes at GBP26.7 million for the quarter, 5% below consensus' expectations, and overall volume per customer was down 4% on-quarter. "The second consecutive quarter of declines in Personal Volumes per Customer is likely to be viewed negatively by the market, and we believe VPC is likely to remain subdued given the current macro environment," analysts Gautam Pillai and Advika Jalan say. Peel Hunt rates the stock hold. Shares fall 12.3% to 513.4 pence, their lowest level since mid-March. ([e-mail])

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