Shore Capital's response to Light Science Technologies Holdings PLC's (AIM:LST, FRA:9FD) latest order news reveals more about the broker's conviction than the contracts themselves.
Rob Sanders and Akhil Patel used Wednesday's update to reiterate a discounted cash flow valuation of 4.6p, more than double the current share price, based solely on the Passive Fire Protection division reaching £20 million of revenue.
This means it excludes any contribution from Ag Tech, the company's other growth arm, which Shore Capital explicitly flagged as unpriced upside.
The analysts went further, suggesting the DCF value "could be multiples of 4.6p" if Ag Tech gains traction, a notably bullish aside for a note ostensibly about fire barrier contracts.
Shore's arithmetic on revenue coverage, close to 80% of its £11.5 million full-year forecast, reassures on delivery risk.
The Building Safety Regulator's approval of the Leicester installation is treated as more than a single contract win, with analysts framing it as evidence of growing regulatory awareness that could unlock the wider Injectaclad pipeline.
In afternoon trading, the stock was up 5% to 1.87p.
