Don't sell your Royal Mail shares, Panmure Gordon urges

[TrueBlueTerrier]

http://www.citywire.co.uk/money/the-exp ... 712206#i=2" onclick="window.open(this.href);return false;

Not got round to offloading your Royal Mail (RMG.L) shares yet? Not to worry, according to Panmure Gordon, because 'meaningful upside potential' remains.

'Despite the strong share price performance since listing, we believe there is still meaningful upside potential on a 12-month view and beyond. We initiate coverage with a Buy recommendation and 570p target price,' analyst Gert Zonneveld said.

The pillars of Zonneveld 'buy' thesis are an attractive regulatory regime, recent productivity gains, a modest risk profile and strong cash generation. His target price values the business at £5.7 billion, compared with the sale price of £3.3 billion. Panmure Gordon acts as a market maker for Royal Mail.

The analyst's recommendation coincided with news that investment bank JP Morgan told ministers the business could be worth some £10 billion – around two and a half times what the government got for it.

However, Schroders has reiterated its caution around Royal Mail's pension scheme deficit which could restrict the amount of cash for its dividend in future.

Shares in the group closed at 534.2p on Friday, up 5.2p or 1%.

[zootmartian]

City analyst Gert Zonneveld, gets my attention every time, i had already heard his opinion on Bloomberg of this £5.70 price, I had my target price set at £5.40 (ish) and so have stopped buying for now, I'm ready to sell on his advise and no one else's, take no notice of the JP Morgans out there, Gert is the man worth following on twitter.

[k979aaa]

Cannot sell mine till after three years.

[zootmartian]

Cannot sell mine till after three years.

Yeah those free ones are a bugger