Compass: Oddo raises target price

(CercleFinance.com) - Oddo BHF maintains its "neutral" rating on Compass shares, having increased its target price for them from 1,830p to 1,870p, after increasing its expectations for the British catering services group following its annual results.


The broker points to a best-in-class profile, with organic growth and margins that are significantly ahead of its competitors, as well as a very strong financial position (ND/EBITDA at 1.3x by end-2022).

However, Oddo notes that these positive aspects come against a backdrop of high valuation relative to the sector that is trading at a 2023 EV/EBIT multiple of 15.8x, reflecting a 20% premium to Sodexo and close to its historical multiple.

Maybe not today, though - the Compass share is currently down almost 2% in a London market that is up almost 1%.



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