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(Sharecast News) - Analysts at Berenberg lifted their target price on Bridgepoint to 455p from 360p on Friday, citing a fresh round of upgrades following the group's unscheduled trading update on 7 October.
Berenberg, which reiterated its 'buy' rating on the stock, said strongerthanexpected performancerelated earnings across FY26-28, driven initially by Energy Capital Partners Fund V and later by both ECP and private equity, had prompted the valuation change.
Bridgepoint has now upgraded guidance three times this year, with Berenberg stating the exceptional returns in ECP V were behind the FY26 PRE uplift, with one asset, ProEnergy, expected to deliver substantial carry on its own. PRE guidance for FY27-28 has also been raised, reflecting broader contributions from ECP funds and strong value creation in private equity.
Fundraising targets have been exceeded, highlighted Berenberg, with the increased 28bn goal for FY24-26 already being met and the total now expected to reach around 30bn.
Berenberg said the combination of higher managementfee visibility and upgraded PRE across FY26-28 meant profits and cash generation should rise significantly.
Bridgepoint has rebased its FY26 dividend per share from 10p to 15p, equivalent to around 40% to 45% of EPS, and plans to distribute 40% to 60% of cash profits thereafter through ordinary dividends and topups via specials or buybacks.
Berenberg noted that its fundraising assumptions were already close to the new guidance, so changes there were limited. However, the PRE upgrades drove a 40% increase to its FY26 EPS forecast and an 8% uplift for FY27, while dividend per share estimates rose 56% to 96% across FY26-28, in line with the updated distribution policy.
The German bank also raised the multiples used in its valuation framework, citing stronger fundraising, betterthanexpected fund returns, higher embedded value, bestinclass underlying earnings margins and an enhanced capitaldistribution profile. FRE and PRE multiples moved from 12x/6x to 15x/7.5x, respectively.
Reporting by Iain Gilbert at Sharecast.com