Packaging group Bunzl PLC (LON:BNZL) got a boost today after Barclays Capital upgraded its rating for the FTSE 100-listed firm to ‘overweight’ from ‘equal-weight’.
The broker’s analysts also said they had increased their target price for Bunzl to 2,550p, up from 2,450p previously, offering 9% upside potential above the current price.
And they said they see 3,000p as “an upside scenario over a two year period.”
In late morning trading, Bunzl shares were 0.7%, or 17p higher at 2,352p.
In a note to clients on Bunzl, the analysts said “we believe organic growth and acquisition spending are at an inflection point, while the medium-term earnings power of the business remains amongst the highest of the 30 companies we cover in the sector.”
They added: “The valuation of 21x 2017 PE is high, but we believe it is justified by the ability of the group to reliably deliver high-single digit earnings growth regardless of the macroeconomic conditions.”