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(Sharecast News) - Analysts at Berenberg nudged their target price for Coca‑Cola HBC higher on Tuesday, lifting it from 5,453p to 5,483p, as they reiterated a 'buy' rating on the stock and said the forthcoming acquisition of Coca‑Cola Beverages Africa would materially strengthen the group's long‑term growth profile.
Berenberg said the deal would give CCH access to a large, fast‑growing consumer base, positioning the bottler among the quickest‑expanding operators globally and enabling it to benefit from favourable demographics and rising carbonated soft drink penetration.
It argued that CCBA's core markets offer a significant "demographic dividend", with working‑age populations expected to grow at more than twice the pace of CCH's existing footprint and urbanisation rates rising from a low base. All of CCBA's top‑five markets also sit below the $10,000 GDP per capita threshold where CSD consumption typically accelerates.
Berenberg highlighted a sizeable margin opportunity, noting CCBA's FY24 operating margin of 7.4% remained weak relative to peers and its own history, partly due to inflation and EM currency pressure but also, it said, a lack of operational focus under previous ownership. It believes CCH can unlock meaningful improvement.
The German bank also described the transaction as financially attractive, citing implied multiples of 12.9x EV/EBIT, 7.4x EV/EBITDA and 0.9x EV/sales. Berenberg expects the deal to be immediately EPS‑accretive by around 1.5% even before synergies, with an initial ROIC of 5.4% that could rise quickly as efficiencies are realised.
Canaccord Genuity lifted its target price for Victrex on Tuesday, raising it from 725p to 1,050p, as it said last week's capital markets day had set out a clearer, more disciplined strategy for the polymer specialist.
The broker said the CMD marked a "back‑to‑basics" reset, with management halving the company's dividend, outlining what had gone wrong in recent years, and presenting a focused plan to improve returns. Key themes included scaling back non‑core and loss‑making activities, tightening operational discipline, and highlighting very low UK capacity utilisation, which implies limited need for further investment in the near term.
Canaccord said the strong share price reaction suggested investors were supportive of the new direction and highlighted that Victrex's renewed emphasis on core strengths should underpin more realistic medium‑term expectations.
The Canadian bank, which reiterated its 'buy' rating on the stock, also noted that the group's ambition of a 4% to 7% compound annual growth rate compares with just 0.1% over the past decade.
Canaccord said opportunities remain significant across aviation, medical, automotive, electronics, energy and industrial markets, though Victrex now plans to pursue incremental penetration rather than large "moonshot" programmes. Forecast changes reflect both the recent pre‑close update and more conservative CMD assumptions, resulting in a 5% uplift to FY26/27 earnings per share but a 14% cut to FY28.
Reporting by Iain Gilbert at Sharecast.com
