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Michele Maatouk Sharecast News
11 Sep, 2023 08:28

Melrose Industries valuation 'up with events', says RBC Capital

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Melrose IndustriesSharecast graphic / Josh White

Melrose Industries

529.00p

15:44 22/11/24
4.09%
20.80p

RBC Capital Markets downgraded Melrose Industries on Monday to ‘sector perform’ from ‘outperform’ as it argued the valuation was "up with events", but lifted the price target to 540p from 525p.

FTSE 100

8,260.10

15:45 22/11/24
n/a
n/a

FTSE 350

4,551.10

15:45 22/11/24
n/a
n/a

FTSE All-Share

4,506.61

15:45 22/11/24
n/a
n/a

General Industrials

7,836.33

15:45 22/11/24
1.44%
111.05

The bank said the fundamentals remain very supportive, with the business growing well, and it expects further earnings upgrades. It also pointed to the fact that a share buyback is set to start in October.

"However, we think this is all ‘known’ now, even the earnings per share upgrade potential may not surprise the street given traditional management conservatism," RBC said.

"And it is in the valuation already with the blended peer multiple at 11x2025E EV/EBITA versus Melrose at 10.6x (and that is on our above consensus Melrose forecasts)."

At 0825 BST, the shares were down 1.3% at 504p.

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