Broker tips: Ophir Energy, KAZ Minerals, Micro Focus

However, they continued to believe the shares were a "strong" value play, helped by the fact that it had the strongest balance sheet in its sector, with anticipated net cash at $85m as of year-end 2017.

The company had cut its production guidance for 2017 to 12,000 barrels of oil equivalent per day, from a range of between 12,150 to 13,500 boepd before, due to lower off-take at Sinphuhorm a slower ramp-up at Kerendan in the frst half.

A final investment decision at its Fortuna FLNG project offshore Equitorial Guinea had also been pushed into the backhalf of the year.

Recent royalty increases on miners in Tanzania also led Canaccord to be more cautious, lowering the NPV 10 central value for the company's gas resources in the African country from 94p per share to 88p a share.

Greater confidence on China's plans for grid investment and revised forecasts for electric vehicles led analysts at Deutsche Bank to bump up their medium-term copper price projections.

However, they stuck to a 'neutral' recommendation on shares of copper miners (albeit with a couple of exceptions), telling clients they first wanted to see greater 'self-help' improvement before moving to an 'outperform'.

Previously, the broker had expected the copper market to remain in a surplus over the near-term, but now they envisaged a medium-term deficit.

Their revised price forecasts called for copper futures on COMEX to rise from $2.6 a pound in 2018 to about $3.0 in 2019, with Chinese demand seen growing by about 3.5% a year, up from 2.0% beforehand.

They also cautioned clients that there was scope for greater supply disruptions in Chile in 2018 because the country was facing more mine supply labour negotiations.

Geopolitical factors in the African Copperbelt required monitoring as well.

First Quantum remained its top-pick in the sector, Deutsche said. The broker also lifted its target price for KAZ Minerals (Sell) from 350.0p to 400.0p.

"Copper miners have yet to demonstrate they will not repeat the same mistakes of the last cycle, in our view. Instead, we believe copper miners need to focus more on opex performance, where they have lagged behind their bulk peers over the past several years (ie labour & equipment productivity)."

Barclays believes recent share price weakness in Micro Focus is an opportunity.

The day before the company had posted an approximately 15% fall in its second half licenses and earnings before interest, taxes, depreciation and amortisation were wide off the mark by about 2.5%.

Investors were also wary ahead of its acquisition of Hewlett Packard Enterprises's software arm, a recent miss on licenses by HPE Software itself, they explained.
As an aside, that EBITDA miss was the direct result of an entire team leaving its host connectivity business.

Nonetheless, flat guidance for the first six months of 2018 meant the business was "stable".

Operating expenditures at HPE Software were also faling more rapidly than expected, suggesting the 'self-help' investment case was largely on track, they said.

So changing hands at about 10 times EBITDA, which was near the company's pre-deal announcement levels, and at 10 times their 2020 proforma estimates for earnings per share, the previous session's share price weakness was an "opportunity".