Fundamentally AG is a strong business but the last couple of years have shown that it has come off the pace in terms of growth. The 2.5 point P/E derating in the last 12m reflects this. Given a soft comp the group has scope to surprise on the upside but we would like to see evidence of good trading momentum and market share gains returning to the story before turning positive. An accretive deal / international diversification would also help sentiment. We estimate a sugar tax hit to EBIT of c.13 ....
26 Feb 2016
Needs to find its fizz again
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Needs to find its fizz again
A.G. BARR p.l.c. (BAG:LON) | 562 33.8 1.1% | Mkt Cap: 630.2m
- Published:
26 Feb 2016 -
Author:
Sahill Shan -
Pages:
5
Fundamentally AG is a strong business but the last couple of years have shown that it has come off the pace in terms of growth. The 2.5 point P/E derating in the last 12m reflects this. Given a soft comp the group has scope to surprise on the upside but we would like to see evidence of good trading momentum and market share gains returning to the story before turning positive. An accretive deal / international diversification would also help sentiment. We estimate a sugar tax hit to EBIT of c.13 ....