Analyst Andrew Douglas of Jefferies reiterated a Buy rating on Severfield, retaining the price target of p41.00.
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Andrew Douglas has given his Buy rating due to a combination of factors, including Severfield’s in-line profit outlook for FY26 and a notably stronger year-end net debt position than the market had expected, reflecting improved cash generation and tighter financial discipline under the new management team. He also highlights that strategic initiatives are progressing well and are set to be detailed further in an upcoming strategic review, reinforcing confidence in the company’s longer-term direction.
At the same time, Douglas acknowledges that the U.K. and European order books have softened since earlier in the year, but he views them as still solid with clear scope for improvement as delayed projects begin, while the Indian joint venture continues to deliver record-level demand and an encouraging pipeline. Although he anticipates that guidance for FY27 profit will prompt earnings downgrades, he stresses that the company’s robust balance sheet and visible recovery potential justify maintaining a positive stance on the shares.