Broker tips: AstraZeneca, Asos, Future

JP Morgan analysts reiterated their 'overweight' stance and 9,500.0p target price on shares of AstraZeneca following the release of early clinical trial data for its Covid-19 vaccine candidate, AZD1222, the day before.

The results of the Phase I/II clinical trial conducted alongside Oxford University's Jenner Institute showed "encouraging" results regarding the vaccine's efficacy for the small subset of patients for which results were now available.

That was true both in terms of the antibody response and the production of T-cells. However, there was as no efficacy data around the relief of symptoms just yet but no serious adverse events were recorded either.

In terms of comparing the results of the trial with those from competing vaccines, the analysts said that was "challenging" due to the different endpoints and assessments the various companies had chosen.

JPM also noted the sharp 10% outperformance in AstraZeneca's shares since 14 July which "arguably" already priced-in significant value for the vaccine programme.

The analysts described it as "an aggressive move considering the still early stage of this vaccine program, the level of competition, and the outstanding questions about the need for and ability to re-vaccinate

Analysts at Morgan Stanley hiked their target price for shares of online retailer Asos from 1,650p to 2,400p following the company's latest trading update and on the back of proprietary research showing that UK consumers were set to continue shunning physical stores.

There was hardly anything extraordinary about the online fashion retailer's guidance for full-year sales, MS said. But the company's steer on profits was well ahead of what they and the consensus had pencilled-in.

"For most pure-play clothing retailers, the tailwind of online channel shift is more than offsetting the headwind of a very weak underlying apparel market. And it is continuing to do so even after stores have reopened," the analysts explained.

The broker's consumer survey data backed up that claim, showing that many consumers were planning to avoid going shopping "unnecessarily" in the coming months.

While changing rooms remained shut, there was little point in going, Morgan Stanley said. Nonetheless, the analysts remained convinced that the shift to online channels would not prove permanent.

"We would urge investors, however, not to leap to the conclusion that the channel shift we are currently witnessing will prove permanent. Our survey data also suggests that once a vaccine becomes widely available, and social distancing is no longer required, most consumers expect to go back to shopping the way they did before COVID 19 emerged."

Analysts at Berenberg took a fresh look at media giant Future on Tuesday following the group's latest trading update a day earlier.

Berenberg said full-year trading for Future was on track to be at the top end of consensus expectations - 5% ahead of its own estimates.

The German bank also credited Future for being "one of very few companies" in the UK mid-cap market to have only made positive earnings revisions in 2020, illustrating the resilience of the company's business model and strategy.

With Future trading on a 17.6 times price-to-earnings ratio and a 6% free cash flow yield, Berenberg said it continues to view the group as "one of the most attractive UK mid-cap media equity stories".

Berenberg, which reiterated its 'buy' rating and 1,600p target price on Future, also highlighted that the group had already secured £9m of annual cost synergies following its acquisition of TI Media in October 2019 - of which roughly £3m will benefit its 2020 results.