Market forecasts for Johnson Matthey PLC (LSE:JMAT) suggest the chemicals sector will enjoy a sharp second-half recovery in 2026, which Deutsche Bank thinks may prove optimistic.
The bank reiterated a 'buy' rating for the FTSE 250-listed emissions control group and raised its price target from 2,300p to 2,400p ahead of the company’s upcoming results.
For cyclicals more broadly, Deutsche analyst Virginie Boucher-Ferte said less optimistic than other City analysts, expecting a weak start to the year, with Q1 down 12% year-on-year.
Despite that, Johnson Matthey is seen as better placed, though the analyst touted other groups as the sector’s “higher quality names” with idiosyncratic drivers: Air Liquide, Akzo, Givaudan, Novonesis, Kerry and Symrise.
She added that while cyclical stocks trade in line with historical averages, the sector remains weighed down by structural changes, making it difficult to call a bottom. Nonetheless, upside scenarios have been modelled for more optimistic observers.