Placing the Abcam on its ‘conviction buy’ list, the American investment bank said there was the potential for the stock to climb over 50% in the next six months. Its price target of 645p reflects this.
“We believe Abcam can continue to grow ahead of the broader consumable life science tools market through share gains and a shift towards more technologically advanced products, where it has a high share and which contribute a higher gross margin,” said analyst Carl Hazeley.
“The company’s proprietary data asset that grows through user-generated content should drive attachment and reliance on its products.
“This, in turn, should support a positive pricing dynamic. We forecast significant cash generation owing to Abcam’s capitallight business model, and expect cash to be deployed towards bolt-on acquisitions and special dividends.”
The shares, off 12% in the year to date, rose 1.5% to 431p.