Credit Suisse ups Hammerson target price after Intu takeover aborted

Analysts at Credit Suisse increased their target price in shares of shopping centre owner Hammerson to 545p from 500p after the company withdrew its offer to purchase Intu Properties on Wednesday.

Hammerson, owners of Birmingham’s Bullring shopping centre, cited the deterioration of the retail property market and concerns over a potentially lengthy merger as the reason for the move some have been unsympathetic. The FTSE 100 group argued that the deal was “no longer in the best interests of shareholders”.

The abandonment of the proposed £3.4bn takeover still leaves Hammerson with “a high quality portfolio of retail property”, according to Credit Suisse analysts who suggested that the company have good exposure to high growth markets through interests in Ireland.

“Hammerson stand-alone remains subject to the cyclical and headwinds that are facing UK retail property in the UK, but its high quality assets should be relatively resilient.”

Hammerson’s ‘neutral’ rating was also reiterated by Credit Suisse analysts, who also projected that the company’s dividend per share would rise 8% to 27.51p in 2018, with further increases over the following two years.

“Our revised target price is based on a 20% discount to our Spot NAV estimate of 679p as estimated in our Ideas Engine report of 15 March,” said the Swiss bank in a research note to clients.

As of 1455 BST, Hammerson’s shares were up 4.50% at 515.80p.