DAVY VIEW

We detect an increasing appetite to embrace ideas that play into the theme of a potential recovery in the UK construction sector in the aftermath of the upcoming General Election. Our view is that Ibstock screens very well in such a framework. In addition, there is the attraction of a potential sharp acceleration in Ibstock’s earnings and cash flows as the benefits of its investment projects begin to flow through. We think this makes for an enticing mix and accordingly upgrade our rating to ‘Outperform’ with a price target of 215p. In time, confidence in the delivery of our 2028 earnings scenario would merit a further appreciation towards 320p.