Berenberg raises target price on Compass
Analysts at Berenberg raised their target price on food service business from 2,460.0p to 2,900.0p on Monday, stating the company was in possession of "all the ingredients for sustained growth".
Berenberg, which also reiterated its 'buy' rating on the stock, said Compass had delivered "a good set of FY24 results" that were "a touch ahead of consensus" and FY25 guidance that was broadly in line with market expectations.
However, Berenberg also noted that the absence of a buyback and some further country exits had moved its earnings per share estimates lower.
"That being said, with its conservative balance sheet and the potential for earnings surprises, we remain positive about the outlook for Compass," said the German bank.
"Compass shares have re-rated in 2025, now sitting firmly ahead of historical levels. We accept that there is likely less scope for multiple expansion from current levels; however, given the sustained growth outlook, the conservative balance sheet and the potential for upside earnings surprises if net new and volume growth surpass expectations, we remain buy-rated."
Reporting by Iain Gilbert at Sharecast.com
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