DAVY VIEW

Breedon’s trading update shows end-markets rebounding strongly through July and August. Sales in the two months combined were up year-on-year (yoy), albeit they included an initial contribution from Cemex. Guidance has been reinstated with the H2 EBIT outturn now expected to be flat. That points to a FY 2020 result c.16% better than market estimates. Having weathered the storm, the group now looks well placed to benefit from accelerated infrastructure spending and reap the benefits of the recently completed Cemex acquisition. We reiterate our ‘Outperform’ stock rating and 98p price target. Group CEO Pat Ward and CFO Rob Wood will present at our Industrials Conference today at 12 noon (see Davy website for details).