Ashtead Group PLC (LSE:AHT), the industrial equipment rental company, traded almost 11% lower on Monday after lowering full-year guidance on the back of a quieter hurricane season and the Hollywood strikes.
Both group and US rental revenue growth is now expected to fall in the range of 11% to 13% (previous guidance for both: 13% to 16%), which will result in EBITDA being 2% to 3% below current market expectations.
Pre-tax profits are expected to slip by 8% as the London-listed group was forced to increase its depreciation and interest estimates.
Liberum analysts said: “There are two headline reasons for the revision to guidance: i) there was very little emergency response work this year (after a normal year last year); ii) the US writers' and actors' strikes both lasted longer than the company guided to.”
However, the analysts added that these were one-off headwinds.
“We would look to buy on weakness as long-term drivers are still intact (notably moves from owning to renting, mega-projects and industry consolidation),” the UK-based brokers said.
Ashtead opened at 5,200p on Monday and is down over 2% in 2023.