Berenberg raises target price on Craneware

By Iain Gilbert

Analysts at Berenberg raised their target price on software firm Craneware from 2,320.0p to 2,600.0p on Tuesday, stating the group was “a rare UK asset”.
Berenberg said Craneware was “an excellent inflationary play” given its “captive customer base” and the “crucial” role its software plays in ensuring revenue integrity and compliance for hospitals and pharmacies in the US, where it has a roughly 40% market share.

The German bank, which stood by its ‘buy’ rating on the stock, also noted that Craneware’s full-year results beat consensus underlying earnings and earnings per share by roughly 3% and 5%, respectively.

“With annual recurring revenues growth for the year in the mid-teens, we expect at least low double-digit revenue growth for the group over the coming years,” said Berenberg.

“Hence, the valuation of circa 22x next 12 months price-to-earnings ratio seems undemanding compared to its ten-year historical average of circa 31x.”

Reporting by Iain Gilbert at Sharecast.com

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