UBS gave a lift to Intertek Group PLC (LON:ITRK) on Wednesday, raising its target price for the testing and certification firm’s stock to 5,400p from 5,200p.
In late morning trading, the FTSE 100-listed group’s shares were 0.6% higher at 5,340p.
READ: Intertek shares slide as it posts decline in first-half revenue
In a note to clients, the Swiss bank’s analysts pointed out that Intertek shares are down around 10% after a recent strategic acquisition and solid first-half results, but said they “see no fundamental cause for concern”.
They noted that Intertek’s “organic growth outlook remains robust, margin improvement is still on track, and Alchemy (US$480mln spend) can bring material long-term benefits to the group.”
“However, for now Intertek's earnings momentum may have stalled while uncertainty has increased (trade fears; higher leverage),” the analysts added.
They noted that their earnings per share estimates have increased by 0-2% overall to reflect the interims and Alchemy acquisition benefits, leading to the target price hike.
But said, with Intertek shares trading at the top of their peer group, they retain a ‘neutral’ stance on the stock.
The analysts concluded: “Although it has been a clear leader for the past 2 years, we now see better scope for acceleration at Bureau Veritas.”