LONDON (ShareCast) - (Sharecast News) - Analysts at Berenberg hiked their target price on ventilation products provider Volution from 240.0p to 315.0p on Friday follow "a very impressive trading update" from the group.
Berenberg highlighted that Volution had delivered like-for-like growth of 6.8% in the first four months of the year and had already hit its 20% margin target, eight months early.

"This growth has been broad-based, with the UK up by 3.1%, continental Europe 7.9% and Australasia 18%. In the UK, the group noted particularly strong growth in repair, maintenance and improvement, with private RMI spend up by 10.4% like-for-like and public 6.6%, supported by a broad residential product portfolio and launches of a number of premium ranges," said Berenberg.

"Unsurprisingly, residential new build and commercial saw revenue decline, but the order intake is encouraging, being flat and significantly ahead in the respective divisions."

As a result of the solid trading, the German bank upgraded its forecasts to reflect the strong margin performance and said it now thinks there is further scope for "revenue-driven upgrades" in 2021.

"With supportive regulation, an increasing focus on indoor air quality and a strong balance sheet, Volution remains an ESG gem, trading on just 15.1x CY21 P/E with a 7% FCF yield," said the analysts, who also reiterated their 'buy' rating on the stock.

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