JPMorgan upgrades Bunzl, hikes price target

JPM said that following the company’s FY22 results and London roadshow, it is re-vising the story as it finds itself positive for 2023 relative to its wider sector. The bank highlighted three key positives.

"1) Pricing remains positive, particularly into H1-23, but also likely for 2023 overall, in our view," it said.

"2) Leverage finished 2022 at a record-low level, 1.2x under the covenant definition (1.7x including leases and deferred M&A consideration). 3) The valuation has normalised relative to the market and we see some upside, catalysed by earnings momentum."

In its 2023 estimates, JPM is 4% above company-compiled consensus at EBITA and EPS. Compared to current Bloomberg consensus EPS, JPM is 3% above.