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(Sharecast News) - Analysts at Canaccord Genuity initiated coverage of building products supplier Brickability on Wednesday with a 'buy' rating and a 106p target price, arguing that the market was undervaluing the group's growing exposure to high-margin, regulatory-led verticals.
Canaccord Genuity said Brickability has been diversifying at scale into fire remediation contracting and renewable technology installations, both of which were benefiting from structural demand and limited competition.
The Canadian broker said these segments now contribute 44% of FY25 trading underlying earnings, up from just 7% in FY22, materially improving the mix and resilience of group profits.
Canaccord said the shares, trading on a CY26E price-to-earnings ratio of just 6.2x, appear to reflect a perception of Brickability as a low-margin, asset-light distributor exposed to a soft construction market.
"We disagree," the broker said, describing the group as a "sustainable compounder" with a solid balance sheet and sticky customer relationships.
"We think Brickability should be valued at least on par with listed peers. Our multiples-based approach applied to CY26E estimates suggests the shares can almost double from current levels," added Canaccord.
Reporting by Iain Gilbert at Sharecast.com
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