Deutsche Bank has reiterated its "buy" rating for Tate & Lyle PLC (LSE:TATE), setting a price target of 850 pence, up from the last close of 669 pence.
The bank highlights that the company’s acquisition of CP Kelco is on track to complete by the end of 2024, following recent UK listing rule changes that remove the need for a shareholder vote.
Tate & Lyle’s trading performance was in line with expectations, with revenue growth for the full year forecasted to be slightly below last year, but EBITDA growth expected between 4-7%, the German bank noted.
CP Kelco’s performance has stabilised, with volumes significantly ahead of the prior year.
Deutsche Bank also said that the return on investment for the acquisition is expected to exceed the company’s cost of capital by the fifth year after completion. Tate & Lyle has completed £102 million of its planned £215 million share buyback programme.
The shares were up 3.5p at 672.5p.