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Jan 16 2023, 07:00 GMT
Building products
Time to take a walk on the lightside
- Sectors : Building products
- Companies : Forterra plc | Marshalls | Howden Joinery | Kingspan Group | Grafton Group | Tyman | Genuit Group | Volution | Travis Perkins plc | Ibstock plc
Ratings
Ratings and price correct at time of issue
| Company | Rating | Date | Previous Rating | Date | Closing Price |
|---|---|---|---|---|---|
| Forterra plc | NEUTRAL | 19/08/16 | N/A | N/A | 200p |
| Genuit Group | NEUTRAL | 05/11/21 | N/A | N/A | 330p |
| Grafton Group | OUTPERFORM | 07/10/20 | Neutral | 21/05/20 | 898p |
| Howden Joinery | OUTPERFORM | 31/03/22 | Neutral | 26/09/19 | 659p |
| Ibstock plc | NEUTRAL | 04/08/17 | Outperform | 19/08/16 | 164p |
| Kingspan Group | OUTPERFORM | 12/05/11 | Neutral | 30/06/09 | 5834c |
| Marshalls | NEUTRAL | 10/11/21 | N/A | N/A | 320p |
| Travis Perkins plc | NEUTRAL | 28/05/20 | Underperform | 01/07/16 | 1021p |
| Tyman | OUTPERFORM | 24/03/21 | N/A | N/A | 261p |
| Volution | OUTPERFORM | 31/03/21 | N/A | N/A | 399p |
DAVY VIEW
2022 was, to put it mildly, a year best forgotten for our building materials lightside coverage list. The steep drop in equity values essentially pre-empts this year’s operational hurdles. Our universe screens very well from a valuation perspective should existing forecasts hold up. The jury is out on this. Our instinct is that, notwithstanding the near-term cyclical downturn risk, investors should focus on those businesses best placed to snap back quickly, that can take advantage of any industry dislocation and that offer structurally through-the-cycle advantaged propositions. Fasten seatbelts, but we gravitate towards the established quality of Howdens and Kingspan. Deep value is another consideration, with Grafton and Tyman standing out.
