CRH boosted by Canaccord upgrade

CRH was given a boost on Wednesday after Canaccord Genuity upgraded its rating on the building materials business to ‘buy’ from ‘hold’ and reiterated a target price of €32.00.

Canaccord said recent data suggests that the group's end markets should be enjoying continued positive trading momentum.

Construction lead indicators in some European countries are at “significant post financial crisis highs”, the broker said. While the US has seen some weakness in public construction, residential and commercial work remains strong and the "good trend" in US materials pricing is continuing.

“Recent lead indicators suggest that trading, particularly in Europe, has been supportive for management's recent full year guidance,” said Canaccord.

“With good trading supporting a fast deleveraging balance sheet, as we enter 2017, the market is likely to increasingly focus on a strengthening balance sheet which offers potential for further acquisitions and investment. Share price has edged lower over the last few months with valuation now looking more attractive.”

Canaccord said it reiterates its positive medium-term view on attractive organic growth, deleveraging and acquisitions.

Shares in London rose 0.27% to 2,613p at 0934 GMT.