Weir Group PLC's (LSE:WEIR) third-quarter update has left RBC Capital Markets feeling quietly confident. Orders fell 2% on an organic basis, better than the 5% drop the broker had forecast, though aftermarket growth in its Minerals division slowed to 3% from 10% in the first half.
Copper mine disruption and softer diamond demand were partly to blame, but management said September finished strongly after a weaker summer, setting up a solid run-in to the year-end. Full-year guidance is unchanged.
RBC expects the December capital markets day to focus on Weir’s software arm, bolstered by last year’s Micromine acquisition, and to reaffirm the goal of operating margins above 20%. No fresh targets are likely, but the event should showcase the group’s longer-term potential.
Analyst Mark Fielding kept his 'outperform' rating and raised his price target to 3,175p, implying about 12% upside from the current 2,880p. He values Weir’s Minerals unit at 17 times 2026 earnings before interest, tax and amortisation, broadly in line with Swedish peer Epiroc, and its ESCO business at 13 times.
RBC thinks Weir’s strength lies in its steady aftermarket business, which generates more than 90% of group profit and provides resilience even when new mining equipment orders dip.
The broker sees margins climbing beyond 20% next year and an earnings growth rate of around 12% a year through 2029, supported by disciplined mining investment and rising demand from the energy transition.
Weir, Fielding argues, deserves to trade closer to the top of the pack among Europe’s industrial engineers.