Vp’s year end update reiterates recently revised guidance for adj. PBT to be in the £26m-£29m range (our forecasts are positioned at the bottom of this range). Whilst cal. ’26 has started slowly against a volatile macro backdrop, we believe the medium-term outlook remains compelling. Vp is the quality operator in the sector, with an unmatched ROCE profile. It is well placed to benefit from the recovery when it materialises, with a raft of infrastructure projects scheduled over the coming years, not least the benefits of AMP8 as it enters its second year. We forecast adj. PBT growth of 27%/5% in FY27/FY28. Whilst the Board hasn’t yet given a formal view on the dividend, we continue to maintain the dividend in our forecasts based on Vp’s strong track record of dividend payments. The shares trade on an FY27 PER of 7.8x, with a 9% dividend yield. In our view, this materially undervalues the shares and we stay at Buy.
