Davy Morning Equity Briefing
May 06, 2026
Heidelberg Materials
FY26 guidance reiterated
Despite a challenging Q1, particularly in Europe where bad weather had led to a slow start, the business has been able to reiterate FY guidance for €3.40-3.75bn in RCO (EBIT). Cost increases are expected to materialise in the coming months but surcharges and price adjustments have been sought to offset.
dsm-firmenich
Q1 EBITDA in line, organic sales growth ahead
dsm-firmenich has delivered a solid start to 2026 with EBITDA in line with expectations. Organic sales growth was well ahead though aided by some pre-buying, notably in Perfumery & Beauty, which delivered a solid underlying performance. Margin in the quarter was dragged down by Taste, Texture & Health. FY guidance was maintained and as such we expect to leave our full year estimates broadly unchanged.
Lufthansa
Adjusted EBIT for full year 2026 still expected to be significantly above prior year
Lufthansa has maintained its outlook statement. The increased kerosene prices currently lead to additional costs of €1.7bn in 2026. Due to these uncertainty factors, the risk-opportunity profile has shifted toward risks. Nevertheless, Lufthansa Group maintains its guidance for the full year to achieve an operating result (adjusted EBIT) significantly above the prior year (€1,960m), Davy: €2,162m (consensus: €1,878m). In our view, delivery of this in 2026, with the resultant risks, would lead to a re-rating.
Hostelworld
AGM statement, reiterates guidance
Hostelworld released a brief trading update ahead of its AGM today. It notes that to date its revenues have not been materially impacted by the conflict in the Middle East. It understandably flags “some softness” in long-haul demand in Asia, but this is currently being offset by intra-Europe. It reiterates its guidance issued in late March that performance will be in line with current market expectations, assuming no further escalation.
UK economy
Escaping two lost decades
Despite another challenging year for the UK economy, made worse by war in the Middle East, we look forward to 2027 and 2028 with a more upbeat outlook. In the context of two lost decades and weakening productivity growth, there are now reasons to expect that faster UK economic growth lies ahead.
