Coats Group PLC (LSE:COA) shares rose 1.4% to 80.3p on Friday after the industrial thread and footwear materials maker said full-year results remain on track, with trading resilient despite subdued market conditions.
In an update covering the four months to 31 October, Coats said revenue fell 1% at constant currency as customer orders remained cautious amid wider economic uncertainty.
However, profits and margins were broadly unchanged from last year, helped by tight cost control and pricing discipline.
Cash generation stayed strong, and leverage is expected to be around 2.2 times at year-end following the recent acquisition of insole specialist OrthoLite, which continues to perform well.
The company said it remains confident in delivering results in line with market expectations and expects further progress in margins and cash flow through 2026.
Broker Peel Hunt said the valuation of Coats' shares was "compelling", given the strength of free cashflow generation and "attractive returns".
It pointed out the shares trade on a meagre ten times earnings. Peel them 'buy' with a price target of 125p.