DAVY VIEW

Hill & Smith (HILS) remains one of our top picks for 2024. The tailwinds of US infrastructure investment, self-help from organic investment in its existing higher growth/higher margin business and further M&A will drive profits higher over the coming years. With the FY23 out-turn ahead of expectations, we nudge up our above consensus FY24E and FY25E adjusted EBITA by just over 1%. In our view, the improving financial metrics fully justify the current rating. We increase our price target (PT) to 2,210p and reiterate our ‘Outperform’ rating.