Galliford Try is in a good place according to broker Liberum with its restructuring now complete and legacy contracts rolling off.
Balance sheet strength is key adds the broker, which is expecting the contractor to have net cash of £239m of spot net cash and £217m of average monthly net cash by the end of £222mln.
Liberum has a target price of 250p and a ‘buy’ recommendation but, of that, cash amounts to 148p a share while an earnings multiple of 6.6 times makes the shares look cheap.
On the metric of total balance sheet strength relative to the size of the business, Galliford now has the highest reported net cash as a percentage of sales in the sector adds the broker.
New targets for 2026 also look achievable with towards £1.6bn of revenue and 3% margins in both Building and Infrastructure.
The group meanwhile has a valuable PPP portfolio worth £49m based on the latest directors’ valuation adding to its appeal as a possible bid target.
Shares were 177.6p, up 0.3% today.