Drugs group gets tonic from broker

THE FTSE 100 opened relatively flat, but slipped into negative territory, dipping below the 6700 mark at lunchtime, led downwards mainly by the mining sector.

THE FTSE 100 opened relatively flat, but slipped into negative territory, dipping below the 6700 mark at lunchtime, led downwards mainly by the mining sector.

In the regional portfolio, pharmaceuticals group GlaxoSmithKline received a boost to its share price after JP Morgan upgraded its recommendation for the company from “underweight” to “neutral” and lifted its 12-month price target from £12.25 to £13.50. Glaxo’s share price ended the day 1.6% higher at 1310p.

North-East company Immunodiagnostic Systems Holdings plc (IDS), which produces diagnostic testing kits for the clinical and research markets, announced preliminary results for the year to March 31.

Revenue increased 22% to £9.9m with operating profit up 97% to £2.21m. Among its operational highlights was the addition of new products through development and acquisition as well as expansion of its direct distribution network.

Chairman David Evans said: “Trading in the current year is ahead of last year and in line with management expectations. On July 4, the board announced the conditional acquisition of Nordic Bioscience Diagnostics for a total consideration of £17m.” Despite the positive results the share price ended 5.5% lower at 281p.

Investment manager Panmure Gordon said it had initiated coverage of North-East group Southern Cross Healthcare with a “buy” rating and a price target of 700p, believing the company was in a strong position to capitalise on growth in the industry.

Southern Cross is the largest provider of care homes for elderly people in the UK and also provides specialist services for people with physical or learning disabilities. The company’s shares ended the day 9p higher at 575p.

The strongest performance of the day came from Hargreaves Services, for which we act as broker, whose share price ended 6.3% higher at 632.5p.

Fiona Erdozain is an investment adviser at Wise Speke

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