Berenberg lifts price target on Hill & Smith ahead of update

Hill and Smith
1,766.00p
08:54 02/10/23
Berenberg lifted its price target on Hill & Smith on Monday to 1,600p from 1,490p as it updated its numbers ahead of a trading update this week, to reflect the acquisitions and trading so far in FY 2023.
FTSE 250
18,374.68
09:00 02/10/23
FTSE 350
4,179.55
09:00 02/10/23
FTSE All-Share
4,136.16
09:00 02/10/23
Industrial Engineering
13,602.23
09:00 02/10/23
The bank, which maintained its ‘buy’ rating on the shares, said it believes the business has clearly made material progress over the past 12-18 months in terms of portfolio improvements, underlying growth and pricing given strong cost inflation, "with more to come".
In the longer term, Berenberg thinks there is a "really interesting" opportunity to build a larger business.
"The market structure within galvanising in particular is such that it makes sense to buy assets with good management teams, good baseloads of customers, a good control of environmental and regulatory risks, as well as good regional economic structures," it said.
"For instance, with circa £50m-70m spend per annum over two to three deals, over a three- to five-year period that adds up into more meaningful scale."