Deutsche Bank boosts target price on SIG ahead of first 1H update in years

In a research report sent to clients, analysts Priyal Muljii, Glynis Johnson and Xavier Marchand took special note of the fact that it would the first trading update covering the first six months of any year for the insulation supplier since 2014.

That, they said, was part of new management's drive to provide greater detail and to update shareholders regularly.

Nevertheless, the company had already provided a fair bit of colour on recent trading in its most recent update on 11 May, so no big surprises were expected.

In terms of the bigger picture, the dominant theme continued to be the potential for a turnaround in the longer-term under the new management team.

Yet little was likely to be forthcoming on that subject on this occassion.

After fine-tuning their margin assumptions on the back of recent commentary from SIG itself and a solid performance thus far in 2017, they raised their target price for the shares from 100.0p to 155.0p.

One aspect of the company's financials that investors were especially interested in having further details on were its debt metrics, they said.

The first half of each year tended to see a seasonal step-up, according to Deutsche Bank.

Management had previously said it was targeting a net debt to EBITDA ratio of between 1.0 and 1.5 by end-2018.

"So investors will be alert to any further colour on this."