LONDON (ShareCast) - (Sharecast News) - Analysts at Barclays raised their target price on textile rental and workwear group Johnson Service Group to 175.0p on Thursday, labelling the firm more of an "iceberg" than a value trap.

Barclays said Johnson Service's value was mostly below the surface and while it acknowledged that it was unclear as to whether or not this would change on a twelve-month view, the analysts think the group was "far from a value trap".

The bank highlighted that stable pricing supported a margin recovery and stated that management could also add further value through the downturn.

"Therefore, we believe investors can confidently own it awaiting value to resurface with a HORECA (Hotels, Restaurants and Catering) upturn," said Barclays.

The analysts stated that given the group's pre-Covid track record of delivering more than 10% earnings per share growth via roughly 6% organic revenue, 2% organic margin expansion and bolt-ons, they think that with shares trading at around 12 times 2019 full-year net income, with only £200,000 of net debt, the stock looks cheap.

"We estimate current valuation only assumes HORECA recovers to a 7% EBIT margin

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