Analysts at Berenberg hiked their target price on infrastructure group Hill & Smith from 1,775.0p to 1,995.0p on Thursday following the firm’s “impressive” interim results.
Berenberg said Hill & Smith offered “a package of intrinsic and extrinsic drivers” that it believes will enable the firm to deliver higher sales growth, improved profitability, better portfolio management and a stronger environmental, social, and governance story in coming years.
In moving its target price on the stock higher, the German bank cited Hill & Smith’s record sales and operating profits in the first half of its current trading year, strategic developments like its recent portfolio realignment and an “attractive medium-term outlook” as a result of the US government’s landmark infrastructure bill).
“There is a positive outlook for private and public infrastructure spending (roads, in particular) and we think Hill & Smith has an opportunity to extend its product range and enter new markets that offer a strong macro backdrop and regulatory drivers,” said Berenberg, which stood by its ‘buy’ rating on the stock.
“Covid-19 has clearly affected near-term sales, but we are confident that Hill & Smith will deliver a much improved performance in FY 2021.”