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Travis Perkins PLC (GB:TPK)
LSE:TPK
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Travis Perkins (TPK) AI Stock Analysis

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GB:TPK

Travis Perkins

(LSE:TPK)

Rating:64Neutral
Price Target:
605.00p
▼(-1.79% Downside)
Travis Perkins' overall stock score reflects a balance of strong cash flow management and positive corporate events against challenges in profitability and technical indicators. The company's stable balance sheet and strategic leadership changes provide a foundation for potential improvement, but current valuation and operational issues warrant caution.
Positive Factors
Leadership
New Chair Geoff Drabble is expected to drive improvements at pace, leveraging his extensive industry experience.
Market Conditions
The improvement in UK residential RMI is seen as inevitable, with housing transactions picking up, mortgage rates expected to fall, and consumer balance sheets improving.
Stock Rating
The stock rating for Travis Perkins has been upgraded from Hold to Buy due to a compelling risk/reward scenario at historically low share prices.
Negative Factors
Market Share
Travis Perkins noted a loss of market share in Merchanting over the summer, with volumes continuing to decline.
Profit Guidance
The FY24 operating profit guidance has been lowered to approximately £135m from a previous guide of about £150m.
Revenue Performance
Travis Perkins reported total revenue growth of -5.7% for the 3Q, with like for like growth of -6.8%, indicating a decline in performance.

Travis Perkins (TPK) vs. iShares MSCI United Kingdom ETF (EWC)

Travis Perkins Business Overview & Revenue Model

Company DescriptionTravis Perkins plc distributes building materials to the building, construction, and home improvement markets in the United Kingdom. It operates through, Merchanting, and Toolstation segments. The Merchanting segment distributes interior building products, which include drywalls, ceilings, external envelopes, fire protection products, flooring and partitioning products, and tools and accessories to professionals within the construction industry; civil, drainage, and heavy building materials to specialist contractors and trade professionals; and pipeline and heating solutions. This segment also distributes building materials, plumbing and heating products, landscaping materials, timber and sheet materials, painting and decorating products, dry lining and insulation products, doors and joinery, and hand and power tools to trade professionals and self-builders. The Toolstation segment supplies products to the trade, home improvers, and self-builders industry through approximately 500 branches, as well as online, call centers, and a mobile website. It also offers kitchens and joinery products to specialist joiners, kitchen fitters, house builders, local authorities, and national house builders. The company was formerly known as Sandell Perkins Public Limited Company and changed its name to Travis Perkins plc in October 1988. Travis Perkins plc was founded in 1797 and is headquartered in Northampton, the United Kingdom.
How the Company Makes MoneyTravis Perkins generates revenue primarily through the sale of building materials and supplies across its various business segments. The company's key revenue streams include sales from its General Merchanting segment, which encompasses a diverse range of construction materials, and its Plumbing and Heating division, focused on plumbing supplies and heating products. Additionally, the Retail segment contributes to revenue through the sale of tools and home improvement products. The company also benefits from strategic partnerships with manufacturers and suppliers, which enhance its product offerings and competitive pricing. Furthermore, the company's strong focus on customer service and extensive branch network fosters customer loyalty, driving repeat business and contributing to stable revenue growth.

Travis Perkins Earnings Call Summary

Earnings Call Date:Aug 05, 2025
(Q4-2024)
|
% Change Since: 15.14%|
Next Earnings Date:Mar 03, 2026
Earnings Call Sentiment Neutral
The earnings call presented a mixed view with both positive and negative aspects. While there were notable achievements in Toolstation U.K. profitability and debt reduction, the company faced significant challenges in merchanting performance and operational issues related to Oracle implementation.
Q4-2024 Updates
Positive Updates
Toolstation U.K. Profitability
Toolstation U.K. saw an increase in profitability, in line with previous guidance, and is expected to continue performing well despite challenging market conditions.
Reduction in Net Debt
Net debt before leases was reduced by 39.2% from GBP340 million to GBP191 million, reflecting a strong focus on cash generation and balance sheet protection.
Closure of Toolstation France
The closure of Toolstation France is reported as a discontinued operation, eliminating a significant loss from future performance.
Successful Refinance
The company successfully refinanced GBP125 million of U.S. private placement debt on an investment-grade basis, demonstrating financial stability.
Negative Updates
Merchanting Underperformance
Merchant businesses continued to underperform, with the general merchant business ceding market share in the second half of the fiscal year.
Significant Operational Challenges
The company faced operational challenges due to strategic missteps and tactical blunders, including high staff attrition and management void.
Oracle Implementation Issues
The implementation of Oracle Financials led to a backlog of invoices and frustration among colleagues, impacting working capital and day-to-day operations.
Decline in Group Revenue and Profit
Group revenue was down 4.7% to GBP4.6 billion, and adjusted operating profit decreased by 23.2% to GBP152 million compared to the prior year.
Company Guidance
In the recent call, Travis Perkins provided guidance indicating that the group's financial performance for 2025 is expected to remain consistent with 2024, excluding property profits. Key metrics included a 4.7% decline in group revenue to GBP 4.6 billion and a 23.2% decrease in adjusted operating profit to GBP 152 million for 2024. The company also highlighted its efforts to manage cash generation more rigorously, resulting in a 39.2% reduction in net debt before leases, from GBP 340 million to GBP 191 million. The company expects capital expenditure to be around GBP 80 million, property profits at GBP 3 million, and an effective tax rate of 30% for the upcoming year. Despite challenges, particularly in the merchanting business, the company remains focused on enhancing operational efficiency and leveraging its strong fundamentals to improve market positioning.

Travis Perkins Financial Statement Overview

Summary
Travis Perkins demonstrates strong cash flow management and a stable balance sheet, but faces challenges in profitability and revenue growth. The negative net profit margin and decreased EBIT margin highlight operational inefficiencies, while robust free cash flow supports future investments.
Income Statement
68
Positive
Travis Perkins demonstrates a mixed performance in profitability and revenue growth. The gross profit margin for 2024 is approximately 26.12%, indicating a strong ability to convert revenue into gross profit. However, the net profit margin is negative at approximately -1.68%, reflecting challenges in managing overall expenses and profitability. The EBIT margin has significantly decreased, reflecting operational inefficiencies. Revenue has declined over the past year by about 5.22%, indicating a downturn in sales.
Balance Sheet
75
Positive
The balance sheet reflects a stable equity position with a debt-to-equity ratio of approximately 0.55, indicating moderate leverage. The return on equity (ROE) is negative due to the net loss, suggesting inefficiencies in generating returns on shareholder investments. The equity ratio stands at around 48.96%, showcasing a substantial proportion of assets financed by equity, which provides stability against financial risks.
Cash Flow
82
Very Positive
The cash flow statement highlights robust free cash flow generation with a notable growth rate of approximately 79.76% from the previous year. The operating cash flow to net income ratio is favorable, indicating effective cash generation relative to net income. Free cash flow to net income is also strong, pointing to efficient cash management. Despite a challenging net income, cash flows remain resilient, supporting future investments and debt servicing.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue4.61B4.86B4.99B4.59B3.70B
Gross Profit1.20B1.31B1.38B1.31B1.04B
EBITDA202.70M306.40M461.20M464.90M193.70M
Net Income-77.40M38.10M192.20M278.90M-22.40M
Balance Sheet
Total Assets4.03B4.03B4.14B4.40B6.08B
Cash, Cash Equivalents and Short-Term Investments244.40M131.50M235.70M459.80M505.60M
Total Debt1.09B1.05B1.05B1.06B1.90B
Total Liabilities2.06B1.99B2.03B2.16B3.37B
Stockholders Equity1.97B2.04B2.10B2.24B2.71B
Cash Flow
Free Cash Flow150.30M85.00M118.40M167.60M384.90M
Operating Cash Flow222.50M217.60M257.50M332.30M487.20M
Investing Cash Flow-3.40M-58.90M-116.60M139.80M-9.00M
Financing Cash Flow-119.40M-250.40M-377.50M-517.90M-180.50M

Travis Perkins Technical Analysis

Technical Analysis Sentiment
Positive
Last Price616.00
Price Trends
50DMA
591.73
Positive
100DMA
584.91
Positive
200DMA
633.12
Negative
Market Momentum
MACD
12.11
Negative
RSI
65.48
Neutral
STOCH
72.55
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:TPK, the sentiment is Positive. The current price of 616 is above the 20-day moving average (MA) of 588.33, above the 50-day MA of 591.73, and below the 200-day MA of 633.12, indicating a neutral trend. The MACD of 12.11 indicates Negative momentum. The RSI at 65.48 is Neutral, neither overbought nor oversold. The STOCH value of 72.55 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:TPK.

Travis Perkins Peers Comparison

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
77
Outperform
£159.71M10.0016.03%4.34%-6.20%83.31%
77
Outperform
£1.29B32.5516.36%1.47%7.32%-6.70%
70
Outperform
£250.06M71.101.63%3.75%-6.12%-86.98%
69
Neutral
£914.94M18.647.68%3.33%5.88%107.36%
68
Neutral
£149.43M15.069.56%3.01%-1.81%15.19%
64
Neutral
£1.31B-0.94%2.35%-4.34%-220.12%
63
Neutral
$10.76B16.247.41%2.07%2.60%-16.34%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:TPK
Travis Perkins
616.00
-285.30
-31.65%
GB:EPWN
Epwin Group plc
117.50
30.74
35.43%
GB:ECEL
Eurocell
149.50
12.06
8.77%
GB:NXR
Norcros
277.00
63.56
29.78%
GB:GEN
Genuit Group
367.00
-84.65
-18.74%
GB:FAN
Volution
648.00
115.26
21.64%

Travis Perkins Corporate Events

Executive/Board ChangesBusiness Operations and StrategyFinancial Disclosures
Travis Perkins Reports Revenue Decline Amidst Operational Challenges
Neutral
Aug 5, 2025

Travis Perkins reported a 2.1% decline in group revenue for the first half of 2025, primarily due to operational challenges in its Merchanting segment. Despite this, the company managed to stabilize its market share and improve its statutory operating profit to £59m from £48m in 2024. The company also made significant progress in reducing net debt and enhancing cash generation, with a notable 50% increase in operating profit for Toolstation UK. Leadership changes are underway with the appointment of Gavin Slark as CEO, effective January 2026, and new management structures in place to drive future growth.

The most recent analyst rating on (GB:TPK) stock is a Buy with a £10.00 price target. To see the full list of analyst forecasts on Travis Perkins stock, see the GB:TPK Stock Forecast page.

Executive/Board ChangesBusiness Operations and Strategy
Travis Perkins Grants Performance Share Awards to CFO
Neutral
Jun 23, 2025

Travis Perkins announced the granting of conditional awards under its Performance Share Plan to its Chief Financial Officer, Duncan Cooper. These awards, based on the company’s ordinary shares, are subject to performance conditions over a three-year period and include a two-year post-vesting holding period. This move aligns with the company’s strategic goals to incentivize and retain key management personnel, potentially impacting the company’s operational focus and stakeholder interests.

The most recent analyst rating on (GB:TPK) stock is a Buy with a £10.00 price target. To see the full list of analyst forecasts on Travis Perkins stock, see the GB:TPK Stock Forecast page.

Shareholder MeetingsDividends
Travis Perkins AGM: All Resolutions Passed, Signaling Strong Shareholder Support
Positive
May 14, 2025

Travis Perkins plc successfully held its Annual General Meeting on May 14, 2025, where all proposed resolutions were passed by shareholders. The meeting, attended by four shareholders or their representatives, saw resolutions ranging from the approval of the company’s annual accounts to the election and re-election of directors, and the approval of a final dividend for the financial year ended December 31, 2024. The approval of these resolutions, including special resolutions regarding share allotment and market purchases, indicates strong shareholder support and positions the company for continued strategic initiatives.

The most recent analyst rating on (GB:TPK) stock is a Buy with a £11.00 price target. To see the full list of analyst forecasts on Travis Perkins stock, see the GB:TPK Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 06, 2025