Imperial Brands has impressed Deutsche Bank with its commitment to hand out all of its cash flow to shareholders.
The catch is that the German bank doesn’t see much in the way of revenue growth but it’s a case of never mind the (sales) quality fell the (income) width for Deutsche.
With a target price of 2,325p, Deutsche Bank says the value is compelling and compounded by all that cash flow being returned.
It adds that the first half results can be summed up by the chief executive’s comment ‘On track to meet FY guidance', which Deutsche Bank says is 1-2% net revenue growth (and operating profit growth at the lower end of 3.5-6.5%)”.
“Through FY24 and FY25 we expect growth to climb toward the higher end of that range.”
Shares were up 1.9% at 1,891p.