Amcomri Group (AIM:AMCO) offers investors more than 50% upside, and that’s on a ‘conservative’ assessment according to analysts at stockbroker Cavendish.
Amcomri, which made 16 acquisitions in the past threeyears, has a “mature and profitable business” in attractive end-markets and it is advancing with a buy-and-build strategy that will be “highly value-generative”, Cavendish analyst Edward Stacey highlighted in a note.
The analysts pitched a price target of some 89p – representing 53% upside to the prevailing share price in London after the company was floated at a price of 55p in December.
“Amcomri has built an impressive group of specialised engineering and industrial manufacturing businesses generating revenue of £57.1 million (our forecast FY24E) and adjusted EBIT of £6.2 million,” Stacey said in the note.
“Underpinning the investment proposition is a proven ‘Buy, Improve, Build’ strategy, driven by a management team with a proven track record in the industry and investment sectors, as well as in financial and operational management.”
The analyst added: “We believe that Amcomri benefits from a mature and profitable business model, attractive end markets, and a highly value-generative ‘Buy, Improve, Build’ strategy.
“We base our target price on FY25E EV/EBIT multiples by comparing with relevant sector peers, applying a conservative discounted multiple for Amcomri as a new entrant to the public markets.”
Amcomri came to market in mid-December with a £12 million equity raise that valued the company at close to £40 million.
Today, the small-cap share trades at 58.24p each.