Stelrad’s AGM update confirms that year to date trading is in line with expectations, with the full year outlook reiterated. We expect a year of continued strong PBT growth of 12% despite only assuming revenue growth of 2%. This reflects continued proactive margin management and ongoing cost discipline. Stelrad confirms limited tariff exposure, with longstanding supply relationships, all of which are outside of North America. We recently initiated on Stelrad (click here), highlighting a highly attractive investment case. We expect 10% p.a. earnings growth even if current macro conditions persist. Cost discipline, as well as accelerating adoption of premium products, is driving this. Any end market recovery would likely turbo charge Stelrad’s growth profile. Against this, a 9.5x Dec. ’25 P/E rating, combined with a 5.8% dividend yield, appears very undemanding and compares favourably to peers which trade on 15x or above. We target a Dec. ‘25 P/E rating of 15x to drive our 215p TP and Buy recommendation.
