- Volex
- 26 March 2026 15:00:38
Source: Sharecast
Canaccord Genuity said this momentum was also helping operating margins push up to more than 10%, above Volex's previous 9-10% target range, and was setting the tone for what could be "a more sustained margin progression story" ahead of its capital markets day on 22 April, where new medium-term ambitions will be laid out.
The Canadian bank said its 8% upgrade to FY26 adjusted operating profits and 9% to adjusted earnings per share had carried into the outer years, lifting FY27-28 adjusted EPS by around 6% each year.
Canaccord also noted that the potential shift from AIM to the Main Market added "another sign of the group's growing ambitions", though if it does proceed, the analysts noted that investors should expect "some short-term share price volatility".
"Volex has seen a healthy upgrade-driven rerating and now trades on 14.9x CY26E P/E and 8.9x EV/EBITDA, still below sector averages (18x P/E, 10x EV/EBITDA) given peers’ higher underlying margins (~14%)," said Canaccord, which reitetrated its 'hold' rating on the stock.
"We increase our target price to 500p (from 445p) based on a forward P/E multiple of 16x (from 15x). A sustained move to higher margins could support further a rerating toward the peer group, in our view."
Reporting by Iain Gilbert at Sharecast.com