Broker tips: Ultimate Products, Spire Healthcare
By Iain Gilbert
Date: Wednesday 25 Jun 2025
(Sharecast News) - Analysts at Canaccord Genuity lowered their target price on homeware brands specialist Ultimate Products from 130.0p to 80.0p following its Wednesday morning profit warning.
Canaccord Genuity said Ultimate Products' trading update flagged that "challenging trading conditions" had continued across H225, resulting in lower FY25 revenue and profit expectations.
"Heightened macro uncertainty following increased tariffs is causing customer caution and lower forward orders which prompts us to take a prudent approach to FY26 forecasts," said the Canadian bank.
However, Canaccord also noted that while the consumer backdrop "remains fragile" and was impacting Ultimate Products' near-term performance, it also management "clearly has a plan" to improve its medium-term sales performance to help mitigate macro conditions, which along with the growth opportunity in mainland Europe meant that the longer-term growth opportunity remains.
Canaccord Genuity, which reiterated its 'buy' rating on the stock, reduced FY25 adjusted underlying earnings forecast by 14% to £12.5m, whilst adjusted pre-tax profit estimates were reduced by 20% to £8.9m.
"We have taken a prudent approach to FY26 forecasts and believe any self-help driven improvement to the topline as a result of initiatives underway and a reversal of the FY25 gross margin decline could provide upside to forecasts," said Canaccord.
Berenberg raised its target price on private healthcare firm Spire Healthcare 255.0p to 280.0p as it noted that the group's cost savings efforts were "on track".
Berenberg said it believes Spire Healthcare to be on track to deliver mid-single-digit revenue growth and £30.0m of cost savings in FY25, which it noted looks "even more credible" after the group announced headcount adjustments in May.
The German bank expects revenue growth to be evenly weighted between H1 and H2, including mid-single-digit growth in hospital revenues and high-single-digit growth in primary care.
Based on management guidance, Berenberg expects the bulk of Spire's cost savings to be realised in H2, and said it assumes a £10.0m hit related to headcount adjustments.
"As we tweak up our cost savings assumptions, adjust finance costs and factor in the sector re-rating from March to now, our price target moves up to 280.0p," said Berenberg, which reiterated its 'buy' rating on the stock.
Berenberg also highlighted that with the stock trading on a 6.9x FY26 enterprise value/underlying earnings ratio for double-digit earnings per share growth, Spire's valuation "looks compelling".
Reporting by Iain Gilbert at Sharecast.com
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