Peel Hunt upgrades ConvaTec to 'buy'

Peel Hunt upgraded its stance on shares of medical device company ConvaTec on Thursday to ‘buy’ from ‘add’ and lifted the price target to 285p from 240p.

The broker cut its recommendation on the stock last summer. It said that since then, management has consistently outperformed its expectations, with consensus 12-month forward earnings per share having bottomed and now starting to rise.

"The recent 1Q21 trading update put to bed our lingering nervousness on the business mix," Peel Hunt said.

The broker upgraded its 2021 EPS estimate by 4%, putting it above the top end of company guidance and 7% above consensus.