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(Sharecast News) - Analysts at Berenberg lowered their target price on subsea equipment rental provider Ashtead Technology from 700p to 650p on Friday, stating recent geopolitical volatility had impeded momentum.
Berenberg said Ashtead Technology's latest update was disappointing but broadly in line with the downside risks flagged earlier in the summer, with continued Middle East tensions pushing several secondhalf projects into 2027 and denting nearterm momentum.
The German bank noted that geopolitical volatility, vessel rescheduling and wider economic uncertainty had led to project slippage not only in the Middle East but also across Europe and the Americas.
As a result, Ashtead cut its FY26 revenue guidance by around 5% and its EBITA outlook by about 15% versus prior consensus, with delays affecting a number of highermargin rental contracts.
Berenberg said it expects the disruption to be temporary, with the slippage largely a timing issue that could unwind into FY27, potentially leaving the group with a larger pipeline and customer backlog heading into next year.
Despite the softer outlook, Berenberg highlighted Ashtead's "robust" balance sheet, with yearend leverage now seen at around 1.3x, supported by longterm energy security drivers.
Following the guidance cut, Berenberg trimmed its forecasts but said the shares remain attractive at roughly 7.5x FY27 earnings, underpinned by strong fundamentals and structural growth across the energy sector.
Reporting by Iain Gilbert at Sharecast.com
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