UPDATE 1-Amec ups 2008 outlook slightly after strong start

(Adds details, CEO quote, analyst comment)

LONDON, May 14 (Reuters) - British engineer and project manager AMEC Plc (AMEC.L: Quote, Profile, Research) said on Wednesday it expected to perform slightly better than expected in 2008 following strong trading so far this year.

AMEC said it remained confident it would reach its earnings before interest, tax and amortisation (EBITA) margin target of 6 percent in 2008, while current expectations for 2009 remain unchanged.

"AMEC has made an excellent start to 2008 and each of our core divisions is progressing well", Chief Executive Samir Brikho said in a statement.

The company said its end markets in the energy, power and process industries remain strong.

AMEC said it expected 2008 average net cash to be around 600 million pounds ($1.17 billion) after first-half acquisitions and year-to-date buybacks.

Shares in AMEC were down 1.9 percent to 817-1/2 pence at 0809 GMT.

"The share is on a prospective multiple for 2008 of 22.8, falling to 20.4 in 2009. Given that AMEC is now effectively an oil services business, with a peer group that trades on around 20.5 times 2008 earnings, it looks somewhat overvalued", analysts at Seymour Pierce wrote in a note and cut its recommendation for Amec to "sell" from "hold".

(Reporting by Johannes Hellstrom; Editing by Erica Billingham)