- Gamma Communications
- 13 June 2025 14:03:50
Source: Sharecast
Berenberg said following Gamma Communications' annual general meeting trading update in May, it had reiterated its 'buy' rating on the stock but had opted to lower its DCF-based price target. However, Berenberg noted that its new target price still offered an "attractive" potential share price upside of roughly 31%.
"We cut our group EPS five-year CAGR forecast to 9% from 11%, driven by our expectation of lower organic growth in the UK Business division," said the German bank.
"We continue to expect a valuation re-rating in the Gamma shares from current levels (trading at 13x P/E and 8x EV EBITDA). We still believe there is further share price upside potential from more value-accretive M&A or additional shareholder distributions given headroom provided by Gamma's strong FCF generation (c8% FCF yield) and under-leveraged balance sheet."
Reporting by Iain Gilbert at Sharecast.com