Davy Morning Equity Briefing

Jul 07, 2026

XPS Group

Modest forecast upgrades; reiterate ‘Outperform’ with revised price target

Following strong FY results and the strategic acquisition of Austin Professional Resourcing LLP (APR), we update our forecasts and reiterate our ‘Outperform’ rating. Higher revenue assumptions reflect continued organic momentum and APR's contribution, with near-term margin dilution and subsequent EPS accretion thereafter. While we reduce our price target, primarily due to the external environment, our positive view on XPS remains unchanged, supported by regulatory tailwinds, resilient demand and growth in insurance consulting.

Cairn Homes

Significant order book growth underpins FY guidance

An exceptionally strong trading period since April has seen Cairn Homes grow the order book by 25% in circa two months. H1 results will be well ahead of H1 2025, and full year guidance has been reiterated. Increased cashflow starting in H2 will likely provide room for enhanced shareholder returns in the medium term, and the company will update on capital allocation in September.

Robertet

H1-26 preview

Following a particularly strong FY25, we expect organic sales growth to moderate to 3.9% in H1-26 (H1-25: +9.2%) with trends differentiated across divisions. We forecast a rebound in Fragrance, while Flavors and Raw Materials see softer growth as both lap more challenging comparatives. We expect margin pressure to be a key feature of the H1-26 print and forecast group EBITDA to decline 13% year-on-year (yoy) (group margin -320bps yoy), reflecting tougher comparatives following the prior year’s favourable product mix, alongside FX translation headwinds. Over the medium term, with the group’s natural and premium positioning intact, we see the investment case as unchanged. Robertet will release its interim trading update on July 23rd.

Smurfit Westrock

Q2 preview and North America pricing dynamics

While freight and energy costs will drag on near-term performance, we believe Smurfit Westrock is well placed coming into H2. Paper pricing will start to meaningfully flow through, and the operating rate of mills — a key measure of market strength — should also start to improve. The containerboard market in North America is starting to find its feet.