LONDON (ShareCast) - UBS has hiked its target price for engineering giant Weir by 15 per cent from 2,000p to 2,300p and reiterated its 'buy' rating for the stock, causing shares to rise on Friday morning.
The broker highlighted results from Weir's peer group, specifically Metso (Other OTC: MXCYY - news) and Outotec (Other OTC: OUKPY - news) , which surprised on both orders and profits on Thursday.
"There is no doubt mining capex is coming down but the processing market seems better insulated so far. Metso, a competitor in slurry pumps delivered an upbeat assessment of the mining services market, describing it as 'excellent'," UBS (Xetra: UB0BL6 - news) said.
The broker said that a "glimmer of hope" now emerges at Weir Minerals ahead of the company's results on Feburary 27th, with upside potentially coming from: a strong book-to-bill in the second half; heavy rainfall in Australia helping the dewatering business; a reaccelerating aftermarket.
"A not-so-negative message on Minerals could yet propel Weir's share price to higher levels," UBS said.
Shares were up 1.68% at 2,113p by 10:41 on Friday.