FTSE 250 movers: Hochschild shines; Volution hit by downgrade

23rd Oct 2024 12:30

(Sharecast News) - London's FTSE 250 was down 0.5% at 20,839.49 in afternoon trade on Wednesday.

Hochschild shone as the precious metals miner maintained its full-year production guidance after reporting its strongest third quarter in nearly five years.

Ibstock gained as Jefferies upgraded the shares to 'buy' from 'hold' "given the current compelling demand-supply dynamic in the UK brick sector". It applied the same upgrade to Forterra.

The bank said it now sees a clear path to return to prior peak EBITDA (i.e. 2022) by 2027, underpinned by a housebuilding-led recovery but also sufficient spare capacity to fully capture this growth.

"This suggests more than 70% upside from 2024 profit levels, offering significantly more upside than at UK building product peers if they too were to return to 2022 levels from 2024 (less than 40%)," it said.

"This uplift is driven by our expectations of a strong demand recovery underpinned by an improving housing market (we forecast UK brick demand to grow circa +35% over 2024-27, after a circa 40% fall over 2022-24).

"However, with domestic capacity utilisation currently at c.60%, we are in a unique position where both main players have the ability to fully capture recovering demand (as opposed to driving higher imports due to capacity constraints as has been the case for much of the past decade)."

Jefferies said that beyond earnings recovery, robust cash generation and deleveraging offer another leg to the investment case, with ample spare cash for M&A and/ or extra returns.

The bank lifted its price target on Ibstock to 251p from 200p and said it was its preferred pick "given its greater liquidity and higher potential for M&A-driven earnings accretion to boost its still nascent Futures division".

Ventilation products supplier Volution lost ground as Davy downgraded its stance on the stock 'neutral' from 'outperform'.

It said that while it's "very positive" on the Fantech deal and the overall outlook for Fantech, the stock now looks up with events, having risen more than 75% in the past year and more than 35% in the year to date.

Davy said: "It is on circa 20x/17.5x our July 2025/26 earnings forecasts which we think is broadly fair and our valuation analysis yields a price target of 615p, broadly similar to the current level; hence for now at least we are pulling back our recommendation to 'neutral', having been 'outperform' since initiating coverage in March 2021 - since when the stock has outperformed the FTSE 250 by around 50%."

FTSE 250 - Risers

Hochschild Mining (HOC) 242.50p 4.08%

Aston Martin Lagonda Global Holdings (AML) 106.90p 2.69%

VinaCapital Vietnam Opportunity Fund Ltd. (VOF) 460.50p 1.21%

Ibstock (IBST) 197.60p 1.13%

Trustpilot Group (TRST) 237.00p 1.07%

Indivior (INDV) 671.50p 1.05%

PRS Reit (The) (PRSR) 104.80p 0.96%

Baltic Classifieds Group (BCG) 324.00p 0.93%

SSP Group (SSPG) 168.70p 0.78%

Future (FUTR) 862.50p 0.76%

FTSE 250 - Fallers

Volution Group (FAN) 574.00p -3.20%

AJ Bell (AJB) 459.00p -2.86%

Ninety One (N91) 172.00p -2.77%

Man Group (EMG) 204.00p -2.58%

RHI Magnesita N.V. (DI) (RHIM) 3,290.00p -2.52%

Foresight Group Holdings Limited NPV (FSG) 474.00p -2.47%

Bodycote (BOY) 546.00p -2.15%

Chemring Group (CHG) 370.00p -2.12%

FirstGroup (FGP) 136.70p -2.08%

International Workplace Group (IWG) 168.80p -2.03%