In a report released today, Charlie Campbell from Stifel Nicolaus upgraded Travis Perkins (TPK – Research Report) to a Buy, with a price target of p750.00.
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Charlie Campbell has given his Buy rating due to a combination of factors that present a compelling risk/reward scenario for Travis Perkins. The stock is currently trading at historically low levels, which suggests that the market is not fully accounting for potential recovery. Campbell believes that the company’s earnings could significantly increase if it manages to regain the 15% volume lost since 2021.
Additionally, the appointment of Geoff Drabble as Chair, who has a strong track record in the industry, is expected to drive continued improvements and select a capable CEO to sustain these efforts. The broader market conditions, such as improving housing transactions and falling mortgage rates, also support a positive outlook for the UK residential repair, maintenance, and improvement sector. Campbell’s unchanged target price of 750p reflects a nearly 50% upside, supported by various valuation methods, including asset marking, discounted cash flow, and earnings recovery projections.
In another report released yesterday, Citi also maintained a Buy rating on the stock with a £6.00 price target.