MP Evans Group PLC (AIM:MPE) has received a reaffirmed ‘buy’ recommendation from Panmure Liberum, with the share price target held at 1,150p.
Panmure Liberum analysts highlighted the sharp rise in crude palm oil (CPO) prices, which have surged by 40% to $1,340 per tonne in 2024.
As a result, analysts have upgraded MP Evans’ profit before tax (PBT) forecasts by 16%, reaching $94 million for 2024 and $100 million for 2025.
In an interim trading update posted on Friday, MP Evans said shortages of vegetable oil supplies are behind the rise in prices.
Average prices have risen from US$777 per tonne for the first eight months of the year to US$800 for the first ten months with some sales in November exceeding US$950 a tonne.
MP Evans currently trades on a forward price-to-earnings ratio of nine times and is offering a 5.7% dividend yield.
Shares spiked 8.6% to 1,009.8p on Friday.