DAVY VIEW

Ibstock’s trading update is uneventful, which is a satisfactory outcome in the current circumstances. Even though Q1 volumes were below its expectations, EBITDA was in line and the group’s full year expectations are unchanged. Accordingly, we envisage no changes of note to full year estimates. The stock does not look that appealing on near-term forecasts but actually is potentially very cheap on the combination of a recovery in earnings along with the impact of Ibstock’s growth investments coming through. For now, sentiment understandably is focused on the short term, but this will not necessarily remain the case indefinitely.