- Travis Perkins
- 02 April 2025 10:39:26
Source: Sharecast
The broker cut its target price for the shares from 880p to 650p and kept a 'hold' rating on the stock.
TPK's share price dropped by more than 10% on Tuesday after the company delivered its results for 2024. While there weren't any material surprises in the full-year figures, the outlook guidance – for flat adjusted EBITDA in 2025 – was weaker than the markets had been expecting.
As a result, Berenberg has lowered its EBITDA forecasts for TPK by around 20% over the next three years.
"The company has suffered from a combination of challenging market conditions as well as – in its own admission – the result of some poor strategic decisions," said Berenberg analyst Harry Goad.
"Furthermore, the much-hoped-for strategic and operational reset under the new CEO, Pete Redfern, who assumed the role in mid-2024, ended abruptly with his resignation on – sadly – health grounds in March."
Looking at 2025, TPK said merchanting conditions remain "challenging" with prices and volumes likely to see a "modest decline". Things over at the Toolstation division look more positive, though it only makes up a small part of the whole business.
Goad said TPK does have the potential to deliver on self-help initiatives and there is also scope for a market recovery. However, a 'hold' rating was kept "as we await evidence of positive traction on either or both", he said.
Shares were down a further 3% at 480.4p by 1026 GMT.