Brokers' view: Seymour Pierce

Metals and mining analyst Asa Bridle rated shares in Seymour Pierce client and Slovakian gold miner Ortac Resources as a buy following drilling results from its Kreminca project in the Eastern European nation.

Bridle noted that the deposit’s current resource stood at 1.2 million ounces of gold, adding that the target of a two million ounces of gold equivalent resource is ‘readily achievable’.

The Seymour analyst remarked that its European peers are currently trading at an average enterprise value/adjusted resource valuation of $81/ounce, over five times Ortac’s current valuation. With cash of £10.3 million and a shareholding in the Vatakoula goldmines giving it a further 0.4p a share, Bridle argues that it is currently valued at 3p a share.

Debenhams in the doldrums
Retail maven Kate Calvert rates shares in high street heavyweight Debenhams as a hold following a trading update in which it reported a 0.3 per cent increase in like-for-like sales over the year to 27 August.

Calvert noted that with earnings before interest and taxation likely to remain static for the next two years and a consumer spending environment that is ‘set to remain challenging’, it is ‘difficult to see any material growth drivers’. Arguing that it is ‘not the most attractive story in the sector’, Seymour is forecasting profits of £157.5 million (EPS: 8.7p) for 2011.