Broker tips: Zotefoams, Burberry, AstraZeneca, GSK

(Sharecast News) - Analysts at Berenberg hiked their target price on polymer foams manufacturer Zotefoams from 540p to 590p on Tuesday after the group's 22 January trading update revealed that both full-year revenue and adjusted pre-tax profits were expected to be ahead of market expectations. Zotefoams reported good revenue growth across both the Europe, Middle East and Africa, and North America regions, with EMEA benefitting from a strong year in the consumer and lifestyle division, while its North American performance was underpinned by a strong performance in transport and smart Technologies. Asia, on the other hand, saw headwinds, although Berenberg noted that this region represents only 2% of group revenues and was mainly focused on the construction and other industrial end-market.

The German bank updated its forecasts to include Zotefoams' recent acquisition of OKC, an "innovative foam producer" based in Spain, and a small underlying upgrade based on the improved trading.

"We remain confident in management's medium-term strategy to grow Zotefoams both organically and inorganically. The OKC acquisition, along with growth in areas aside from consumer and lifestyle, is further evidence of management's thoughtful approach to growing revenue. Zotefoams trades on an FY26 P/E of 9.7x and EV/EBIT of 8.9x," said Berenberg, which reiterated its 'buy' rating on the stock.

Barclays upgraded Burberry on Tuesday to 'overweight' from 'equalweight' and lifted its price target on the stock to 1,450p from 1,340p following a "reassuring" third-quarter update, as it said the turnaround strategy was working.

"Following the ongoing improvements seen at the brand, we raise the name to OW as we think that Burberry is an attractive self-help play in 2026 and have fewer reasons to be cautious on the turnaround," Barclays said.

"Indeed, the brand was able to report a second consecutive quarter of positive retail comps in fiscal Q3 (despite particularly tough comps), which we view as a clear sign that the Burberry Forward strategy is working."

The bank said it sees room for further sales and earnings momentum going towards Burberry's next fiscal year. It also said recent market weakness was a good entry point.

"The more advanced stage of Burberry's turnaround plan makes it more likely to see topline and EPS upgrades in 2026 versus other players, and the share price performance is still down circa 50% versus the level of three years ago, back when the brand had revenue of £3bn (versus £2.4bn of revenue today as per our FY26 estimates)," said Barclays.

"We view the recent pullback (shares down 8% year-to-date versus the Stoxx 600 up 3%) as an entry point allowing further upside in 2026 and note that Burberry's PE relative to the sector has come down from recent highs."

Over at Citi, analysts initiated coverage of AstraZeneca and GSK on Tuesday, taking a bullish stance on the former but a more cautious view on the latter.

Citi started AstraZeneca with a 'buy' rating and a 170p target price, arguing that the drugmaker was set to deliver the fastest mid‑term sales and earnings growth in European pharma.

Citi said AZN was on track to exceed its 2030 revenue goal of $80bn, forecasting around $82bn, supported by strong in‑market brands and a series of new launches across its core franchises.

The bank highlighted AZN's research and development pipeline as the strongest in the sector, with risk‑adjusted peak sales equivalent to 86% of FY24 revenues, comfortably outweighing the loss of exclusivity expected later in the decade.

Citi also pointed to a heavy catalyst year in 2026, including multiple Phase III readouts representing more than $30bn in potential peak sales, and the launch of baxdrostat, which it sees as a roughly $6bn opportunity in resistant and uncontrolled hypertension.

By contrast, Citi initiated GSK with a 'neutral' rating and a 1,900p target price, acknowledging improvements in growth, margins, balance sheet and pipeline in recent years, but noting that the medium‑term outlook still remained challenging.

Citi expects GSK's earnings to stagnate between 2027 and 2030, citing the limited ability of its pipeline to offset sizeable losses of exclusivity, particularly in its £7bn HIV franchise.

It said upcoming launches such as Blenrep and Exdensur, along with Phase III data for camlipixant and bepivirosen, were seen as insufficient to drive a meaningful re‑rating. Citi also noted continued weakness in vaccines, with US momentum for Shingrix and Arexvy having stalled.