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(Sharecast News) - Analysts at Canaccord Genuity raised their target price on foams manufacturer Zotefoams from 640p to 675p on Tuesday following the group's in-line 2025 numbers.
Canaccord noted that Zotefoam's full-year figures contained an improved year-end cash flow performance, which resulted in net debt dropping from 37m to 32m, and a net debt-to-underlying ratio of 1.0x. Return on capital, at 13.9%, was also said to be "particularly striking", up from an "already-robust" 11.7% in FY24.
The Canadian bank also acknowledged that trading for FY26 had "started with good momentum", particularly demand in its transport and smart technologies unit, improved order books across multiple markets, and overall "more balanced activity" following moderation in footwear volumes after two record years. OKC, Zotefoams' first material acquisition, was also said to be "trading well", with integration progressing as planned.
Canaccord also highlighted that Zotefoam's capital-light expansion in Vietnam was progressing on track, with management confident in its progress towards the FY29 goals of revenue above 230m, operating profits above 40m, and return on capital employed above 20%.
"We are making minor updates to forecasts to reflect the better cash flow; 2025 includes some complex non-cash adjustments to the tax charge resulting in a substantial beat on EPS (37.1p adjusted diluted vs. CGe 32.4p) which do not materially affect our 2026E & beyond forecasts," said Canaccord.
"There is also a small upgrade to DPS following the final dividend proposal of 5.35p, bringing overall 2025 DPS +5% y/y. With the stock back to trading below 10x P/E, we reiterate our existing 'buy' and raise target to 675p (was 640p)."
Over at Berenberg, analysts hiked their target price on The Property Franchise Group from 645p to 680p on Tuesday, citing "continuing progress from organic initiatives".
Berenberg said the Property Franchise Group's full-year results came in "slightly ahead" of its prior forecasts, reflecting a year of "strong organic progress", consolidating FY24's year of "transformational M&A".
The German bank said Property Franchise had "successfully navigated" the risks posed by the UK's upcoming Renters Right Act, mostly through its "Privilege" programme, which Berenberg said demonstrates "the incremental revenue that can be achieved from the company's newfound scale".
With a number of organic initiatives currently underway, Berenberg also expects additional revenue synergies to drive the firm's organic progress in FY26.
"Given its current trading momentum, we make upgrades to our FY26-27 forecast EBIT, while also updating our tax rate assumptions, leading to overall EPS upgrades of 13-16%," said Berenberg, which has a 'buy' rating on the stock.
"Given this, we also raise our price target to 680p from 645p. On our updated forecasts, TPFG trades on a FY26 P/E of just 9.7x or an EV/EBITDA of 7.2x, both multiples being materially below historical five-year averages, while the FCF yield is now at an attractive 10%."
Reporting by Iain Gilbert at Sharecast.com