In a report released on July 22, James Wheatcroft from Jefferies maintained a Buy rating on Inchcape, with a price target of p1,050.00.
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James Wheatcroft has given his Buy rating due to a combination of factors that highlight the strategic and financial benefits of Inchcape’s recent acquisition. The deal to acquire Iceland’s leading auto distributor is seen as both accretive and strategically sound, as it not only opens a new market but also expands Inchcape’s partnerships with major automotive brands like Mercedes-Benz and Kia for the first time in Europe.
Furthermore, the valuation remains attractive, with projections indicating a 10% annual growth in earnings per share and substantial free cash flow generation over the coming years. The financial metrics, including a price-to-earnings ratio of 9.4x and a free cash flow yield of 12.7%, suggest that the stock is undervalued compared to its historical range, reinforcing the Buy recommendation.
In another report released yesterday, Citi also maintained a Buy rating on the stock with a £11.61 price target.
INCH’s price has also changed slightly for the past six months – from p752.000 to p789.500, which is a 4.99% increase.