finnCap Research Company Notes - 23 October 2018

Oct 23, 2018 / Research Notes

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Sector: Industrials

Flowtech Fluidpower (FLO): Q3 trading update: on track, no surprises

Key data               

  • Share price (p): 114.0
  • Target price (p): 200.0
  • Market cap (£m): 67.5
  • Enterprise value (£m): 85.4         

Overall trading was in line for the nine-month period, with revenue growth of 54%, of which organic growth was 6.7%, with a significant boost gained from the acquired Balu operations. Q3 was solid, but as previously signalled, the buoyancy seen at the start of the year has now settled to a steadier pace, with a cautious tone for the outlook for 2019. We reiterate our recently reduced forecasts. The shares remain deeply oversold, on a substantial discount to its peers. We see significant upside once growth is delivered on schedule, which should provide a catalyst to narrowing the current valuation gap.

David Buxton | dbuxton@finncap.com

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