Davy Morning Equity Briefing
Oct 29, 2026
IMI plc
Q3 trading statement
IMI has reported a positive trading statement for Q3, reflecting a slight increase in FY2026 EPS guidance. This is due to the timing of the sale of Truflo Marine and strong growth in Transport. Organic revenue growth was 2% with tough comparatives from the prior year. Order growth was strong in Process Automation.
Smurfit Westrock
Energy cost headwinds lead to a downgrade to FY26 guidance
High levels of energy cost inflation have led Smurfit Westrock management to lower its guidance for full year adjusted EBITDA (now $4.7bn). This is down 6.0% from the midpoint of the prior guided range. This reflects what management describes as “unprecedented” cost inflation.
Greencoat UK Wind
Power prices underpin positive Q3 NAV update
In what is typically a seasonally weaker quarter for output, Greencoat UK Wind (UKW) delivered a positive Q3 net asset value (NAV) update. Supportive power prices drove an 81% year-on-year (yoy) increase in cash generation despite generation remaining below budget. With pricing remaining supportive into year-end, cash generation should remain strong through Q4.
Associated British Foods
FY26 results preview – limited margin of safety
We remain cautious on Associated British Foods (ABF) ahead of its FY26 results (November 3rd). While Primark’s recent price reductions should support its competitive position, we expect the volume response to lag the initial pricing impact – leaving like-for-like (LFL) growth under pressure against a subdued apparel demand environment. We expect forward buying and cost controls to support FY27 margin guidance, although the progressive rollover of existing cover and continued uncertainty around Sugar leave group earnings exposed to further revision risk. Against this backdrop, we believe the current valuation provides limited margin of safety, particularly given the extended execution uncertainty surrounding the upcoming demerger.
lastminute.com
Weak Q3 packages drives guidance downgrade
Lastminute.com has reported an adjusted EBITDA of €18.4m for Q3 2026, 7% growth year-on-year (yoy). Despite weaker revenues (down 2%), margin improved 1.6pp – reflecting disciplined marketing spend (-7%) and lower fixed costs (-4%). Packages revenue was particularly weak (-6% yoy), reflecting lower volumes despite an improved take rate. The company has cut its full year guidance to flat revenues and flat adjusted EBITDA yoy (previously revenues up mid-single-digit and adjusted EBITDA up mid-single-digit to 10%). As the nine-month revenues are +2% and adjusted EBITDA +2%, this suggests further weakness is to be seen in Q4. We forecast adjusted EBITDA of €59m and expect to bring our forecasts in line with prior year results of €54.9m.
UK economy
UK public finances are set to remain fragile
2026 has been characterised by upside surprises to the UK’s economic growth, and there is possible further scope for outperformance ahead thanks to a better productivity backdrop. Despite this, the UK’s public finances are set to remain in a precarious and fragile state. Reduced fiscal headroom, largely a result of higher borrowing costs and the Iran war, means very limited capacity to avoid larger fiscal tightening over the coming years.
