Today’s profit warning vindicates our Sell stance and forecast caution. We await the conclusions of the strategic review but do not anticipate anything radical and envisage a difficult 24 months ahead with BS write downs and a dividend cut. The best that can be hoped for is a PE approach and this likelihood has increased. A 7-8x EV/EBITDA would imply a price of 385p-440p. Our new FY16 PBT is 2% below management’s low end guidance and we forecast a flat outlook over FY17-18. We set 280p (vs 335p) ....
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Revised view and forecasts post the anticipated warning
- Published:
29 Apr 2016 -
Author:
Sahill Shan -
Pages:
5
Today’s profit warning vindicates our Sell stance and forecast caution. We await the conclusions of the strategic review but do not anticipate anything radical and envisage a difficult 24 months ahead with BS write downs and a dividend cut. The best that can be hoped for is a PE approach and this likelihood has increased. A 7-8x EV/EBITDA would imply a price of 385p-440p. Our new FY16 PBT is 2% below management’s low end guidance and we forecast a flat outlook over FY17-18. We set 280p (vs 335p) ....