Panmure Gordon has retained its 'hold' rating for Associated British Foods but has hiked its target price from 1,450p to 1,670p after Thursday's trading update, saying that the group should be a 'core holding in the sector'.

"ABF was our large cap stock of the year in 2012, and despite a 36% rise over the last 12-months, we believe that given the long-term growth potential of Primark, ABF should be a core holding in the sector."

Seymour Pierce has upgraded its rating for Home Retail Group from 'hold' to 'sell' after the firm raised its profit guidance on Thursday, owing to a better-than-expected performance by its Argos division.

However, analyst Freddie George remains cautious. He said: "we are concerned that the decline in profits at Argos over the last five years is more structural than cyclical and the outlook is unlikely to change over the next three years. There is also little in the current strategy that, in our view, will arrest the current decline in Argos' profits.

Investec has reiterated its 'hold' recommendation for travel and leisure group TUI Travel (TT) after yesterday's announced 'approach' from parent TUI AG (AG), saying that completion of a potential deal looks unlikely.

The broker highlighted that lack of "material" merger synergies - likely to be below the €500m mooted in the press - and has concerns about the management structure after the merger, saying that "industry legend" and TT Chief Executive Peter Long would like leave.

BC

Related share prices
Associated British Foods (ABF) share price
TUI Travel (TT.) share price
Home Retail Group (HOME) share price