Kingspan has run into the red pen being waved around at Deutsche Bank today with the building insulation materials supplier having its target price slashed to €70 from €110.
Deutsche Bank's analysts have clearly thought about it long and hard as the new price is based on a trading update that came out more than a week ago.
Even though Kingspan forecast a record first-half trading profit of €415mln, up from €329mln, its accompanying comments were the 'first tangible sign of weakening in the sector', said the bank.
“As probably one of the first truly negative outlook statements in the sector so far, management is stressing that the mood in most end markets has deteriorated over the last two months with the order intake volume down significantly on the May and June period in 2021 (but still ahead of the same period in 2019).
“In addition, order backlog in Insulated Panels is reported down 2% in volume terms at the end of May, having been up 19% year-on-year at the end of March.”
A 'hold' is the investment view, with the shares down 5.4% today at €57.24.