In a report released today, David Farrell from Jefferies maintained a Sell rating on Halma plc (HLMA – Research Report), with a price target of p2,490.00.
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David Farrell has given his Sell rating due to a combination of factors, primarily focusing on the risks associated with Halma plc’s revenue concentration. Despite a positive outlook and an increase in EBITA projections for the upcoming fiscal years, Farrell highlights concerns over the company’s reliance on Avo Photonics, which is expected to constitute a significant portion of the group’s revenue.
Farrell believes that the market is not adequately pricing in the risks associated with the dependency on a single customer, which could pose challenges if there are any disruptions. While there is an upward revision in the price target, the underlying concerns about revenue concentration and potential market mispricing lead to the retention of an Underperform recommendation.
According to TipRanks, Farrell is a 4-star analyst with an average return of 10.3% and a 61.31% success rate. Farrell covers the Industrials sector, focusing on stocks such as Volution, Chemring, and Halma plc.