Jefferies has cut its rating on Ashtead Group PLC (LSE:AHT), the equipment rental group, citing the recent strength in the shares.
It has moved to 'hold' from 'buy', with the price target lowered to 5,700p from 5,900p.
"Ashtead shares have rallied strongly and re-rated on improving US construction outlook sentiment, but near-term earnings momentum we think remains muted," the US bank said.
"We see some risk that rental growth may take a number of quarters to recover while 1H highlighted potential margin headwinds that could slow EPS growth further."
Analysts said they "continue to like the long-term structural story" but with the shares costing 20 times 2026 earnings, there is now a "balanced risk-reward at best"
It was part of a wider review of support services names after the first-half results season by Jefferies, which also included an upgrade for ISS, the Danish outsourcer, on what it sees as better commercial momentum and a robust free cash flow outlook.
The bank stayed positive on testing companies and reshuffled its stance on staffing firms.
Recruiter Adecco also moved up to 'buy', reflecting a "more constructive view" on temp volumes following the improving momentum over the last months.
On the other side of the coin, London-listed Hays PLC (LSE:HAS) was downgraded to 'hold', as earnings momentum is expected to remain negative "on the back of the continued headwinds on perm and as we anticipate further downgrades".
The common thread, Jefferies said, is that earnings momentum and market positioning will drive relative performance into the second half of 2025.