Market's view on Intertek Group
Published on April 2024
- Kepler Cheuvreux has increased the price target for Intertek to 5000 pence from 4500 pence, recommending a ‘buy’.
- A stock watcher believes Intertek is a solid business but considers the purchase risky at a 19x PE with only 4%-6% growth per annum, suggesting potential interest if prices drop by 10%-20%.
- Intertek is recognized as a global leader in a sector increasingly vital due to global warming, with a strong financial track record, though it appears to garner limited attention on financial forums.
- Opinions vary on the company’s recent performances, with some finding updates satisfactory, while others express concerns about high valuation multiples leading to harsh penalties for minor earnings misses.
- Concerns are raised about Intertek’s revenue recovery being hindered by supply chain disruptions compared to the pre-pandemic period, alongside weak trading volumes and unimpressive commentary.
- Frustration is expressed by a stock watcher who, disappointed by negative reactions to company results, decides to sell their shares taking a small loss.
- Analysis of the stock suggests it might be range-bound in the short term, though recovery to higher price levels is anticipated.
- Despite maintaining a robust RoCE, there is criticism about sluggish earnings recovery and unexciting valuations based on current forecasts, highlighted by strong opposition to remuneration proposals.
- Questions arise regarding sudden stock price drops with no apparent news to justify the decline, raising issues about the impact of a strengthening GBP.
- A trading update described as reasonable does not specify further details, reflecting the general ambiguity in recent communications from the company.
- Observations note an unexpected sharp drop in stock prices following a positive start on a trading day, suggesting underlying issues not immediately visible.