Daily Banking News

PZ Cussons PLC at a turning point says Barclays, starting coverage with

PZ Cussons PLC (LON:PZC) is “at a turning point” said Barclays, which initiated coverage with an ‘overweight’ recommendation.

Jonathan Myers joined the personal healthcare products firm last May as its first-ever external chief executive and the investment bank reckons that new initiatives to address non-core businesses and step up brand investment should revive growth.

READ: PZ Cussons leaves dividend unchanged as handwashing boosts sales

The FTSE 250 group needs a portfolio change, even though “focused businesses perform better in the long run and are valued at a premium”.

Meanwhile, Carex is the market leader in the UK, with 37% of the market share for hand wash and 27% for sanitiser, so increased demand in the professional hygiene channel, such as schools and shopping malls, represents a largely untapped opportunity with potential for incremental mid-term growth.

The Europe and Americas business does not get the valuation credit it deserves, according to Barclays, as the current price implies a 30% underlying earnings (EBITDA) discount to EU, Americas and Asia-Pacific businesses and seems to assign no value for Africa.

“We value Europe and Americas in line with Global Staples given leadership positions in its categories, best-in-class operating margins and exposure to hygiene, leading to our 300p price target,” analysts commented.

Shares rose 1% to 252p on Thursday at noon, having grown 34% since March 2020.

Read More: PZ Cussons PLC at a turning point says Barclays, starting coverage with

Get real time updates directly on you device, subscribe now.

Notify of
Inline Feedbacks
View all comments

Get more stuff like this
in your inbox

Subscribe to our mailing list and get interesting stuff and updates to your email inbox.

Thank you for subscribing.

Something went wrong.