Notwithstanding a slower start to cal. ’26, 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. We reduce our adj. EPS forecast by 32% in FY26 to the bottom end of the guidance range to reflect last week’s update. However, we take a more positive view on the recovery thereafter, with the benefit of AMP8 and other infrastructure projects expected to come through. We reduce our FY27/FY28 forecasts by 17%/12%. Whilst the Board hasn’t yet given a formal view on the dividend, we have maintained the dividend in our forecasts based on Vp’s strong track record. Our forecasts leave Vp trading on a FY27 PER of 8.3x, with an 8% dividend yield. This materially undervalues the shares. We stay at Buy with a 762p TP (13x PER).
