DAVY VIEW

As we have said for some time, there have been two reasons not to want to buy into Electrocomponents (ECM): (1) the valuation and (2) the margin potential. Strong figures today demonstrate that the group remains the go-to player in terms of product availability; valuation is clearly at more reasonable levels; and despite clear cost pressures, margins have been stronger than expected. Notwithstanding the geopolitical climate, we move to ‘Outperform’.