Melrose Industries ‘presents compelling investment opportunity’, says Citi.
Citi reiterated its ‘buy’ rating on Melrose Industries on Friday as it said it "presents a compelling investment opportunity", sending shares in the aerospace manufacturing firm higher.
Melrose Industries
14 March 2025 10:06:57
Source: Sharecast
The bank, which has a 735p price target on the stock, acknowledged investor concerns regarding variable consideration impacting free cash flow.
"However, Melrose forecasts cash flow directly from expected shop visits/deliveries, with EBIT derived from cash," it said.
"We continue to believe the strength of the business lies in the strong, long-term cash generation from RRSPs, which supports the company's projected free cash flow of £600m in FY29."
Citi noted that the stock is now trading at a significant discount to peers, even adjusting for increased risk.
"We therefore believe Melrose presents a compelling investment opportunity."
Halifax is not responsible for the content and accuracy of the Markets News articles. We may not share the views of the author. Understand the risks, please remember the value of your investment can go down as well as up and you may not get back the full amount you invest. We don't provide advice so if you are in any doubt about buying and selling shares or making your own investment decisions we recommend you seek advice from a suitably qualified Financial Advisor. Past performance is not a guide to future performance.
