Source: Sharecast
Berenberg said the Property Franchise Group's full-year results came in "slightly ahead" of its prior forecasts, reflecting a year of "strong organic progress", consolidating FY24's year of "transformational M&A".
The German bank said Property Franchise had "successfully navigated" the risks posed by the UK's upcoming Renters Right Act, mostly through its "Privilege" programme, which Berenberg said demonstrates "the incremental revenue that can be achieved from the company's newfound scale".
With a number of organic initiatives currently underway, Berenberg also expects additional revenue synergies to drive the firm's organic progress in FY26.
"Given its current trading momentum, we make upgrades to our FY26-27 forecast EBIT, while also updating our tax rate assumptions, leading to overall EPS upgrades of 13-16%," said Berenberg, which has a 'buy' rating on the stock.
"Given this, we also raise our price target to 680p from 645p. On our updated forecasts, TPFG trades on a FY26 P/E of just 9.7x or an EV/EBITDA of 7.2x, both multiples being materially below historical five-year averages, while the FCF yield is now at an attractive 10%."
Reporting by Iain Gilbert at Sharecast.com