LONDON (ShareCast) - Shares in household and personal care products group McBride suffered last month on a profit warning but ahead of its interims next Tuesday broker Panmure Gordon predicts more positive news from the group going forward and rates the shares a ‘buy’.
In early January, McBride said its operating profit for the first half of the financial year will be below last year's figure after it was hit by promotional activity by the big brand labels in the UK.
As a consequence of the weaker performance in the UK, it indicated an interim operating profit, excluding exceptionals, of around £10m, down from £11.6m a year earlier. Panmure analyst Damian McNeela is forecasting an 17% drop in adjusted interim earnings per share to 2.9p.
McNeela anticipates an improved performance from the group in the second half, driven by revenue momentum in Europe and cost savings across the business. He is forecasting adjusted earnings per share growth of 23% to 9.2p for its current 2014 full year and believes the stock looks attractively valued, trading on a forward 2014 multiple of 10.4.
McBride's customers include major supermarkets like Tesco, Sainsbury, Asda, and Aldi. Its own brands include the Oven Pride and LimeLite cleaners and the Clean ‘N Fresh range for dishwashing, laundry and general cleaning.
Shares were little changed at 104.75p at 12:50 on Friday.
KP
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